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Is Time Warner Buying a Stake in Vice Media?

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Time Warner Inc. is in talks to acquire a major stake in Vice Media. The development was first reported by Sky News. Time Warner or Vice Media is yet to confirm the story.

As per the report, Time Warner might transfer its news platform HLN to Vice and in turn obtain a major stake in the latter. The deal is likely to value Vice Media at $2.2 billion. The valuation has increased over 50% since last year when Rupert Murdoch-led Twenty-First Century Fox, Inc. (FOXA - Free Report) had valued Vice Media at $1.4 billion and bought a 5% stake in the company for $70 million.
Though the talks are in full swing, the outcome would be clear once the companies agree on the final terms of the deal. Sky News has also added a caveat that the deal might ultimately fall apart or take a new turn.

Time Warner has an existing agreement with Vice Media for airing its news magazine series on HBO. Last month, HBO renewed the “Vice” series for two more seasons, to be aired in 2015 and 2016, tentatively.

Vice Magazine was launched by current CEO Shane Smith along with a couple of others in Montréal, Canada in 1994. It was dedicated entirely to punk culture. Over the years, Vice evolved into a worldwide youth oriented media company with wide business interests ranging from print, online event, music, television and motion films. The mini media house operates some of the most popular channels on Google Inc’s. YouTube and has built lucrative content partnerships with social media behemoths Facebook, Inc. (FB - Free Report) and Twitter, Inc.

The media house has also maintained its distinctive style and subversive attitude that has helped it achieve tremendous success over the time.

Though its operations run across the world, a deal with Time Warner would accelerate the company’s overseas expansion. As for Time Warner, acquiring a stake in Vice Media would help attract a sizable young audience.

Notably, the news comes at the same time when Time Warner announced the spin off of its magazine unit Time Inc.

Currently, Time Warner has a Zacks Rank# 3 (Hold).

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