Time Warner to Buy Rest of Essence
Time Warner Inc. said Tuesday that it agreed to buy the 51% of Essence magazine’s publisher it didn’t already own, adding the African American women’s lifestyle publication to its magazine division.
Terms weren’t disclosed. Essence has a circulation of 1.06 million, said Edward Lewis, chairman and co-founder of Essence Communications Partners. Sales at the company, which also organizes an annual prime-time television awards show honoring African Americans, rose 3% to $150 million last year, Lewis said.
The purchase is the first in three years for Time Inc., Time Warner’s New York-based magazine unit. Time Inc. publishes People, Sports Illustrated and InStyle magazines. The unit last year relied on advertising sales and the introduction of three titles, including British weekly men’s magazine Nuts, to increase sales and earnings.
“There has always been a mutual understanding that if Essence ever wanted to sell its remaining interest, we wanted to purchase it,” Time Inc. Chief Executive Ann Moore said.
Shares of Time Warner fell 31 cents to $19.10 on the New York Stock Exchange.
Time Inc. bought 49% of New York-based Essence Communications in 2000 for an undisclosed sum. In September, Essence Communications started Suede, a fashion magazine that plans to publish nine issues in 2005.
Essence Communications, which will be moving to the Sports Illustrated offices in New York, plans to introduce more publications “in the next couple of years” under its Time Inc. ownership, Lewis said. Essence is “profitable,” he said, without providing details.
Lewis and the board of closely held Essence own the 51% that Time is buying. Lewis will stay with the company as nonexecutive chairman of Essence Communications, and Michelle Ebanks, now group publisher, will be president.