Time to Buy Magazine Firm for $480 Million

Time Inc. has signed a “definitive agreement” to buy Southern Progress Corp., a century-old magazine and book publishing firm, for $480 million, both companies said Thursday.

Jeanetta Keller, a spokeswoman for Southern Progress, said the agreement is for a cash transaction of $395 million, plus another $85 million “for cash, cash equivalents and certain current assets.”

Southern Progress, which includes Southern Living and Progressive Farmer magazines among its publications, had revenue of $165 million in 1984, with revenue growing at an average rate of 16% annually over the past four years, Keller said.

J. Richard Munro, president and chief executive of Time Inc., said in a prepared statement issued by Keller that such a purchase, first explored in the 1970s, “comes along only once in a lifetime.”

“The purchase was carefully examined as part of our development process, and we concluded it was an opportunity we simply couldn’t pass up,” he said.

“Southern Living and its sister publications are quite different from our present magazines, both in editorial coverage and the markets they serve,” said Henry A. Grunwald, editor-in-chief at Time Inc. “But what they have in common with us is a commitment to quality.”

The announcement said Emory Cunningham, chief executive of Southern Progress, and his staff of some 550 employees will continue to run the company.

Southern Progress, founded in 1886 and headquartered in Birmingham since 1911, initially built its reputation with Progressive Farmer, which has a circulation of 573,000. In 1966, it launched Southern Living, with a circulation now of 2.3 million.

It also publishes Creative Ideas, with a circulation of 735,000, and plans to offer a new regional publication, Classics, aimed at the well-to-do Southerner and with an initial circulation of some 125,000.

Southern Progress also prints some 2 million books a year.

“Southern Living is an extremely well-run, high-quality publication,” said Munro. “It is the country’s largest regional home-service magazine and for many years has occupied a special niche in that market.”

Cunningham said Southern Progress is “very pleased” to be joining Time Inc.

“Combining the know-how and resources of these two companies should work to the benefit of both,” he said.