The Koch brothers have reportedly put up $550m to buy Time Inc – why?
Time Inc is in the midst of a radical re-shaping of its properties, which also include Fortune and Sports Illustrated, as it looks to transform as a digital-platform publisher. Photograph: Richard Drew/AP
The Koch brothers don’t usually court media attention so why are the right wing billionaire businessmen suddenly so interested in Time Inc, the legendary publisher behind Time and People?
Charles and David Koch are reported to be putting $550 m behind Meredith Corp’s revived bid to purchase Time, the media group established by storied magazine magnate Henry Luce.
The reason for the Kochs’ interest in publishing is not immediately to buy app reviews apparent. Time Inc is in the midst of a radical reshaping of its properties, which also include Fortune and Sports Illustrated, as it looks to transform as a digital-platform publisher.
Des Moines-based Meredith, publisher of Better Homes & Gardens, Martha Stewart Living, Shape and Parents, has been rebuffed three times in its effort to acquire Time Inc, since 2013.
A Meredith-Time Inc deal, with or without the Kochs’ backing, could prove a union of the elders. Like Time, Meredith has a long history in US publishing. It was founded in 1902 by Edwin Thomas Meredith with the periodical Successful Farmer.
Meredith has previously indicated its interest is in Time Inc’s media properties excluding Time and Fortune magazines. It made a bid for the company earlier this year but the approach was rebuffed after Meredith was forced to lower a $2bn offer as the outlook of the print publishing industry continued to worsen.
Time Inc, was spun off from Time-Warner in 2014 after previous merger talks with Meredith first collapsed. The backing of the Kochs, however, could move it from courtship to consummation.
According to Bloomberg, the Kochs’ net worth stands at $47bn, placing them in 12th place on the Bloomberg Billionaires Index of the world’s wealthiest people.
The Koch brothers’ involvement in a new Meredith effort to buy app installs acquire Time Inc, immediately raised questions about whether their intentions were in part political.
The brothers, owners of Koch Industries, a Wichita, Kansas-based conglomerate with businesses from oil to ranching and farming, have spent decades acquiring influence over conservative causes.
Over the 2016 election, they spent more than $720m to back conservative candidates or back conservative-leaning ballot box agendas; the acquisition of a major, if diminished, publisher could expand their political range of influence relatively inexpensively.
“From afar, it just seems like an investment move,” says media columnist Michael Wolff. “ Meredith has always indicated that they want Time Inc but not Time and Fortune magazines. But possibly that’s how the Kochs get them. But a rightwing Time? Doesn’t really pass business smell test.”
Still, this is not the first time the Kochs have indicated their interest in a publisher. In 2013 they looked at the Tribune Company’s eight newspapers, including the Los Angeles Times, Chicago Tribune and the Baltimore Sun.
Union members, environmentalists and journalists protested against the idea before the Kochs concluded that the purchase wasn’t financially viable. In a statement, Koch industries said the company “continues to have an interest in the media business, and we’re exploring a broad range of opportunities where we think we can add value”.
Time Inc, has been looking to sell off some magazines as it tries to convert its print publishing business to digital. Its restructuring effort has focused on cutting executive suite jobs and converting its online outputfrom text-and-stills to video that advertisers are willing to pay more for.
In June, the company announced 300 job cuts. The job losses amounted to 4% of Time’s total workforce, according to Bloomberg.
But the Kochs may want to consider the fate of DNAinfo-Gothamist before they jump into publishing. The site, which was shut down earlier this month, was supported by Joe Ricketts, a Trump supporter who made a fortune with TD Ameritrade.
Ricketts had warned employees that if they moved to unionize, he would close down the business. They did, and Ricketts shut down the operation, saying he’d made the “difficult decision” because the websites were not economically viable. “But DNA info is, at the end of the day, a business, and businesses need to be economically successful if they are to endure.”