Building on its big lead in magazine publishing, Time Warner's ( TWX) Time Inc. agreed Friday to acquire Times Mirror Magazines from Tribune ( TRB) for $475 million.
Tribune, which owns the Chicago Tribune and the Los Angeles Times, began shopping Times Mirror Magazines earlier this year after Tribune acquired Times Mirror. Times Mirror Magazines publishes U.S. titles such as Golf and Field & Stream. Time Warner reportedly topped a joint bid from New York Times ( NYT) and closely held American Media, which publishes the National Enquirer tabloid. The deal will push Time Warner's claim of U.S. magazine advertising revenue to roughly 25% from around 22.5% -- nearly three times the market share claimed by its nearest competitor. "We're delighted to have the Times Mirror titles become part of Time Inc.," said Don Logan, chairman and chief executive of Time Inc., in a statement. "We think that their vertical sports enthusiast titles are a perfect fit with the Sports Illustrated group." Tribune said it would use proceeds from the sale to reduce debt and repurchase stock. It said it expects its debt to be about $4 billion by year-end. It also said it had repurchased 19 million shares this year. Tribune said in a statement that the deal with Time Inc. is expected to close in the fourth quarter and is subject to regulatory approval. Time Warner shares were higher in early morning trading, rising $1.20 to $68.66. Tribune shares were unchanged at $36.44.