TIME Stock: Is Time Inc Heading for an Acquisition?

Is TIME Stock About to Be Bought OutIs TIME Stock About to Be Bought Out? 

The United States’ largest magazine publisher Time Inc (NYSE:TIME) saw TIME stock surge eight percent on Thursday as The Wall Street Journal reported that the company has hired banks to help field takeover or partnership interest from billionaires and media investors.

Some of the more renowned publications under the umbrella of TIME stock are Sports Illustrated, Fortune, and, of course, the eponymous Time magazine.

Morgan Stanley (NYSE:MS) and Bank of America Corp (NYSE:BAC) were both called in to help with the process, but there is no guarantee that a deal will take place, according to The Wall Street Journal(Source: “Time Inc. Hires Banks to Help Field Takeover, Partnership Interest,” The Wall Street Journal, December 8, 2016.)
Among the most prominent names reportedly looking to get involved with a TIME stock purchase is Edgar Bronfman Jr., billionaire and former CEO of Warner Music Group Corp., who now runs his own private-equity firm, Accretive, LLC. Another name you might recognize is longtime Bronfman adviser Alan Mnuchin of AGM Partners LLP, brother of newly tapped Treasury Secretary Steven Mnuchin.

This is not Bronfman’s first overture to the company.  Last month, Bronfman, along with partners Warner Music board member Ynon Kreiz and billionaire Len Blavatnik, reportedly bid somewhere between $18.00–$20.00 per share. The news promptly sent TIME stock prices soaring by 17%, but was rejected by Time Inc.

Another possible player looking to acquire Time is Meredith Corporation (NYSE:MDP), which owns 17 TV stations and magazines, including Shape, Family Circle, and Better Homes and Gardens. The company has made attempts to acquire Time Inc in the past, but Meredith CEO Steve Lacy has rebuked claims that the company is looking into acquiring Time currently.

“I want to be clear: There have been absolutely no meaningful conversations between our two companies since 2013,” said Lacy. (Source: Ibid.) 
Like the stocks for many other print publications, TIME stock has faced the challenge of declining subscriptions and ad revenue sales. The company missed revenue targets when print advertising fell about 10% in the most recent quarter. Print ads account for about 65% of the company’s total ad revenue. (Source: “Time Inc. Said to Be Evaluating Takeover Interest, Partnerships,” Fortune, December 8, 2016.)
That quarter also saw TIME stock lose more than $112.0 million, down from a loss of almost $1.0 billion a year earlier.
Subscription revenue also fell by more than 14.5% in that same quarter, and overall revenue dropped three percent.

TIME stock is looking to adapt, much like other print outlets, to the complications that the industry has faced in the digital age. This sale might be what it needs to reinvigorate share prices.