Blog Post

Time Inc.: Still Not For Sale — Until It Is

It really doesn’t matter how many times top execs deny a property is for sale — if other people think it should be, it will be proposed and talked about until either the cows come home or until the sale finally takes place. Time Warner hosts a couple of perpetually discussed such properties: Time Inc. and AOL. Nat Ives offers some hope via AdAge for the sell-side proponents when it comes to both … just wait for Chairman and CEO Dick Parsons to leave when his contract is up in 2008 and hope that successor-designate president and COO Jeff Bewkes means when he says nothing is off the table. The focus here is on Time Inc., which estimates have bringing in as much as or more than $16 billion in a sale. A spin-off is another posibility. Some observers such as Bear Stearns analyst Spencer Wang don’t think the perpetual money machine fits in a video-centric company; others argue that TW needs integrated media. There’s also the likely nasty tax hit to consider. (Maybe they could bring in Liberty Media’s John Malone as a consultant.)
— But as much money as Time Inc. makes, it’s not a perpetual growth machine across the board. Time Inc. is counting on digital for the bulk of that and that’s where much of its investment is aimed. Ives quotes a former Time Inc. as saying that the money going to digital is frustrating other areas; a spin-off likely would increase that. Meanwhile, I hear excitement from those convinced that digital is the future.
While we’re in the neighborhood, as for AOL, either Randy Falco and company are there to get the subsidiary ready for sale/spin-off or they’re not. Take your pick.