American Express (AXP) is selling its high-end glossies to Time Inc. in order to comply with federal regulations.
Time is expected to acquire American Express Publishing in the fourth quarter, according to a joint press release issued by the two companies on Tuesday. Amex's publishing division includes Travel + Leisure and Food & Wine as well as card-member magazines Departures, Black Ink and Executive Travel.
Amex had hoped to retain the publishing division it has held since 1968, company spokeswoman Marina Norville told American Banker. But since Amex became a bank holding company in 2008, it is subject to regulations that limit banks' nonfinancial activities.
"Through our discussions with regulators, we decided that publishing fell into the nonfinancial category that was not permissible," Norville said.
The company's long-term relationship with Time, which has provided management services to American Express Publishing for 20 years, convinced it that the New York media company was the right buyer.
"We concluded that Time Inc. is the ideal partner to continue the group's tradition of excellence, and we expect to work closely with them on a range of marketing initiatives in the future," Amex Chief Marketing Officer John Hayes said in the release.
The news comes as Time prepares to split from parent company Time Warner in the first quarter of 2014. The financial terms of the deal were not disclosed.