NEW YORK (Reuters) - Media company Meredith Corp plans to aggressively grow its local TV station group through acquisitions that could eventually lead to a spin-off, the company's chief executive officer said in an interview with Reuters on Monday.
"We are putting together a hit-list of (TV) properties and working with owners," CEO Stephen Lacy said.
Meredith has been an active participant in a flurry of auctions involving local TV station groups. Last July, Tribune Co snapped up Local TV for $2.3 billion and Sinclair Broadcast Group Inc bought Allbritton's TV stations for almost $1 billion.
"We were always second," Lacy said. "We are going to take a different approach and stay out of the auction hoopla."
Meredith's target list includes TV stations in the top 25 markets in the United States that have the No. 1- or No. 2-rated local news broadcasts.
"All the money is in news," Lacy said, adding that 40 percent of all advertising dollars are directed toward local news casts.
Meredith publishes magazines such as Better Homes and Gardens and Every Day with Rachael Ray and has a marketing services arm and owns 13 TV stations across the United States in cities such as Atlanta and Las Vegas.
The plan is to increase Meredith's broadcast revenue to about $500 million. Currently its revenue is $375 million while its publishing division, which includes its marketing services arm has $1.1 billion. The profit between the divisions is split about evenly.
Once Meredith reaches that goal it could potentially separate its broadcasting arm from its magazines. "The reason we are reluctant (now) is the scale," Lacy said. "We talk about spinning a great deal."
Several media conglomerates such as News Corp, Tribune and Time Warner Inc are separating their publishing assets from faster growing entertainment and TV properties.
Meredith was in talks earlier this year with Time Warner to hammer out a potential tie-up Time Warner's publishing division Time Inc, the publisher of People, Sports Illustrated and Time. The talks fell apart and Time Warner plans to spin out Time Inc as a standalone company.
(Reporting by Jennifer Saba in New York; Editing by Lisa Shumaker)