Time Inc. will lay off dozens of employees, following extensive restructuring that unified management teams and consolidated sales forces across the company’s many titles and brands. While the company would not confirm any numbers, The Wall Street Journal reports that 110 employees will be let go. A spokesperson for the company tells Folio: that layoffs are happening across various departments, starting today. Time Inc. employs 7,200 people globally. “Over the last couple of weeks, we have been realigning our organizational structure to better leverage our content creation, sales, and marketing and brand development operations,” the spokesperson said in a statement.
Further to our January announcement, Pearson PLC (“Pearson”) today announces an agreement to sell a 22% stake in the Penguin Random House Venture (“PRH”) to our partner Bertelsmann SE & Co KGaA (“Bertelsmann”) and recapitalise the business. The transaction is in line with our strategy and allows us to generate net proceeds of approximately $1 billion, strengthen our balance sheet, return £300m of surplus capital to shareholders via a share buyback and maintain a significant income stream from an ongoing 25% stake in the world’s leading consumer publisher.
In January we also announced our intention to rebase our dividend. Today we are announcing that our future dividend policy will be to pay a sustainable and progressive dividend that is comfortably covered by the earnings of our ongoing business excluding any contribution from PRH.
This transaction values the Penguin Random House Venture at an enterprise value of $3.55 billion. The formation of PRH in 2013 created the first truly global consumer book publishing company, with a significant market share lead over its nearest competitors. Over the last four years PRH has enjoyed significant creative and commercial success and delivered more than $150m in annualised integration benefits, increasing profit and margins and creating significant value for both partners.
As part of the agreement PRH will undertake a recapitalisation to 2.0x net debt / EBITDA, distributing dividends to both partners. This recapitalisation will be achieved in two steps with PRH initially recapitalised to 1.5x on closing of the transaction, increasing to 2.0x in April 2018.
At closing, Pearson will receive total net cash proceeds from this tax-efficient transaction of approximately $968 million from the sale and associated dividend payments from the initial recapitalisation of PRH. We will receive a further $66m in April 2018.
The transaction is expected to close in September 2017, subject to regulatory approval being obtained, at which time Pearson’s ownership of PRH will fall to 25%. The partial divestment of our stake in PRH is in line with our strategy for simplification and through our successful partnership with Bertelsmann over the last four years we have created significant shareholder value. We will use the proceeds to maintain a strong balance sheet and invest in our business in addition to returning £300 million to shareholders following the closing of the transaction.
more at: https://www.pearson.com/corporate/news/media/news-announcements/2017/07/pearson-agrees-to-sell-a-22–stake-in-penguin-random-house-to-be.html