Time Inc. has been bought by American corporation Meredith in a purchase which was valued at $2.8 billion and was funded with the help of the Koch Brothers, who backed Meredith’s bid. Meredith Corporation has a market value of $2.7 billion and publishes magazines along with owning 15 television stations and four radio stations.

The deal was made possible because $650 million was funded by the brothers, Charles G. and David H. Koch in the acquisition. In the announcement of the deal, Meredith said the private equity fund, Koch Equity Development, will not have any influence on the company’s editorial or managerial operations.

The investors have no intention of an active role in the company. The Koch brothers will control 10 percent of the company due to their investment.

Previous interest in the company

A deal between Meredith and Time Inc. previously fell apart in 2013 after Meredith had reportedly stated it did not wish to acquire some of Time Inc.’s best-known titles, such as Time and Fortune. Earlier this year they expressed interest again but could not find sufficient funding.

Benefits from the acquisition

The media conglomerate did better than Time Inc. since the internet has more premise, and sees the deal generating $400 million to $500 million in cost savings. While there will be job cuts and some title shedding, it is looking to create a premier media company across all platforms.

It has a strong local television business and paired with multi-platform from Time Inc. it can be seen as a transformative transaction.

The media corporation’s digital business looks to accelerate adding significant scale, providing good revenue, diversification and growth, enhance financial strength and flexibility. Shareholder value should increase over time as the good qualities of the acquisition it represents is a good investment opportunity.

There is a great portfolio of leading brands including Sports Illustrated, and it has a lot of potential in digital business.

Meredith should have more scale with Time Inc.’s portfolio, continuing appeal to advertisers in print and digital publishing. The company feels combining the two companies may add to the value, and make a powerful media company.

The purchase was agreed to unanimously by the board at Time Inc., and the deal is expected to close in the first quarter of 2018. Overall, it is a good deal for the company, particularly in digital media.