Meredith Corporation completes the acquisition of Allrecipes.com from The Reader’s Digest Association

March 1, 2012 — Fusion DigiNet

Meredith Corporation has completed the acquisition of the Allrecipes.com business from The Reader’s Digest Association.

Digest Association will use the net cash proceeds from the sale, after estimated taxes and transaction fees, of approximately $150 million, primarily to repay debt and related fees.

“The sale of Allrecipes accomplishes two important strategic objectives for Reader’s Digest Association – the deleveraging of our balance sheet and the continued transformation of the Company as we refocus our resources on our core media and direct marketing businesses in our North America and International divisions,” said Robert Guth, Reader’s Digest Association president and CEO. “We are grateful to the Allrecipes employees for their contributions to our Company and wish them well in their new home.”

USA, Des Moines, IA & New York, NY

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Meredith to acquire Allrecipes.com

February 3, 2012 — Fusion DigiNet

Meredith Corporation is to acquire digital food site Allrecipes.com.

The transaction is valued at $175 million and is expected to close later this quarter.  Meredith plans to invest in Allrecipes.com to optimise 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 – approximately $0.10 per share, or less than 4 percent – 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.

The addition of Allrecipes.com fits with Meredith’s previously stated strategic acquisition criteria: (1) National media brands that provide access to new audiences and advertising categories; and (2) Digital platforms that significantly increase scale.

“The acquisition of Allrecipes.com significantly enhances our digital platform and reinforces our leadership position in the food category,” said Meredith National Media Group President Tom Harty. “It increases our relevance with new, younger audiences, and offers advertisers an unmatched ability to now connect with an audience of more than 100 million consumers.  We are excited to add Allrecipes.com, the world’s No. 1 food website, to our strong portfolio of digital media brands.”

Allrecipes.com currently has a database of over 500,000 recipes.  Its U.S. audience is 70 percent female with a mean household income of $73,000, and it reaches nine out of 10 primary grocery decision makers. Allrecipes.com mobile apps have been downloaded by over 11 million consumers, and they are the No. 1 download on Android, iPhone, and iPad recipe applications.  It is also the top food recipe channel on YouTube.

BDT & Company served as financial advisor to Meredith, and McDermott, Will & Emery served as its legal advisor.  Morgan Stanley and Evercore Partners acted as financial advisors to Reader’s Digest, and Weil, Gotshal and Manges acted as its legal advisor.

USA, Des Moines, IA

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