NEW YORK (CNNfn) - The Time Inc. division of Time Warner Inc. agreed Friday to acquire Times Mirror Magazines for $475 million in cash, the latest move by Tribune Co. to sell off non-core assets.|
Chicago-based Tribune Co., which owned Times Mirror Magazines, will not record a gain or loss on the sale, and will use proceeds to reduce debt and buy back stock. Tribune expects to cut debt to $4 billion by the end of this year and has repurchased 19 million shares.
The companies did not disclose further information of the sale.
Time topped bids by the New York Times Co. (NYT: Research, Estimates) and American Media Inc. for the magazine property, the Wall Street Journal reported, citing people familiar with the situation.
Times Mirror will add such titles as Golf Magazine, Field & Stream and Popular Mechanics to the Time stable of magazines. The two companies combined for a quarter of all magazine advertising spending in 1999, the newspaper said.
"We're delighted to have the Times Mirror titles become part of Time Inc.," Time CEO Don Logan said in a statement. "We think that their vertical sports enthusiast titles are a perfect fit with the Sports Illustrated group."
Tribune Co. (TRB: Research, Estimates) put the Times Mirror magazine group up for sale in June following its acquisition of the Times Mirror Co. Tribune said it would sell four non-core assets, including the magazine group, Tribune Education, Jeppesen Sanderson Inc. and AchieveGlobal.
Tribune has since sold Jeppeson for $1.5 billion, the education group for about $680 million and AchieveGlobal for about $100 million.
"The divestitures of non-core assets will generate more than $2 billion in cash after taxes," said Tribune chairman and CEO, John Madigan. "Tribune is using these proceeds to reduce debt used to finance the merger."
Time's purchase of Times Mirror Magazines is expected to close by the end of the year. The purchase of AchieveGlobal is also expected to close in the fourth quarter.
Time Warner (TWX: Research, Estimates) is the parent of CNNfn. Its shares lost $1.79 Thursday to close at $67.46, while Tribune Co. gained 63 cents to $36.44.