Meredith Completes Acquisition of Allrecipes.com From Reader's Digest
Addition of World's No. 1 Digital Food Brand Doubles Reach of Meredith Women's Network
Mar 1, 2012
DES MOINES, Iowa and NEW YORK, March 1, 2012 /PRNewswire/ -- Meredith Corporation (NYSE:MDP; www.meredith.com) and The Reader's Digest Association Inc. announced today that they have closed on the transaction for Meredith to acquire Allrecipes.com, the world's No. 1 digital food brand.
The acquisition of Allrecipes.com places Meredith first in comScore's Food Community rankings, and more than doubles the audience for the Meredith Women's Network. In total, Meredith can now offer advertisers and marketers access to more than 100 million unduplicated American women across all media platforms.
"Allrecipes.com is a perfect complement to our digital platform, greatly expanding our audience and giving us the ability to connect our advertising clients with highly desirable consumers," said Meredith Chairman and CEO Steve Lacy. "Allrecipes.com will drive incremental revenue and profit growth and add to our already strong free cash flow over time."
The transaction is valued at $175 million. Meredith plans to invest in Allrecipes.com to optimize the site for today's growing online and mobile audiences. This investment spending, along with normal business seasonality, is expected to make the acquisition slightly dilutive to Meredith's fiscal 2012 full-year financial performance. Meredith expects the acquisition will be modestly accretive to earnings per share and free cash flow in fiscal 2013. Meredith has financed the transaction by securing private placement notes with an average weighted interest rate of 2.94 percent.
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ABOUT THE READER'S DIGEST ASSOCIATION, INC.
Actual results may differ materially from those currently anticipated. Factors that could adversely affect future results include, but are not limited to, downturns in national and/or local economies; a softening of the domestic advertising market; world, national or local events that could disrupt broadcast television; increased consolidation among major advertisers or other events depressing the level of advertising spending; the unexpected loss or insolvency of one or more major clients; the integration of acquired businesses; changes in consumer reading, purchasing and/or television viewing patterns; increases in paper, postage, printing, syndicated programming or other costs; changes in television network affiliation agreements; technological developments affecting products or methods of distribution; changes in government regulations affecting Meredith's industries; unexpected changes in interest rates; and the consequences of acquisitions and/or dispositions. Meredith undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
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