Time Warner to spin off Time Inc

New York - Media conglomerate Time Warner is to spin off its iconic Time magazine division, the company said Wednesday, effectively ending its involvement in the print media that was the foundation of its success.

Time-Warner said it aimed to complete the spinoff of Time Inc as a separate public company by the end of the year.

The decision came after talks to create a merger between Time Inc and Meredith, a major publisher of women’s magazines, fell through.

The move would allow Time Warner to focus on its more lucrative film and television businesses, company chairman and chief executive Jeff Bewkes said in a statement. Time Warner owns subscription cable channel HBO and the Warner Bros film studio, which made hit franchises including Lord of the Rings and Harry Potter.

"After a thorough review of options, we believe that a separation will better position both Time Warner and Time Inc," Bewkes said. "A complete spinoff of Time Inc provides strategic clarity for Time Warner Inc, enabling us to focus entirely on our television networks and film and TV production businesses and improves our growth profile."

Time Inc has suffered from years of declining readership and advertising in some of the company’s biggest titles, including Time, Fortune, Sports Illustrated and Money. Other magazines in the Time Inc portfolio include People and InStyle.

Sales of the magazine division sank 7 per cent last year to 3.4 billion dollars, while profits sank 25 per cent to 420 million dollars. Earlier this year, Time Inc announced a 6-per-cent staff cut that would affect some 500 of the division’s global staff of 8,000.//DPA