Time Inc. spins off from Time Warner on June 6

Time Warner, the diversified media company that owns CNN, TNT and several popular magazines, said Thursday it'll complete its previously announced plan to spin off its magazine division, Time Inc., on June 6, a corporate maneuver to protect the parent company from the fallout in print advertising.

After the spinoff, shareholders of Time Warner will own all outstanding shares of Time Inc., which will be publicly traded and operate under its own CEO, Joe Ripp.

Time Warner shareholders will receive one share of Time Inc. common stock for every eight shares of Time Warner common stock they hold as of May 23.

Time Inc. will be listed on the New York Stock Exchange, trading under the symbol "TIME."

The spinoff has been in the works for more than a year. Time Warner initially announced the plans on March 6 last year to separate the publishing business, joining other media companies, such as News Corp and McGraw-Hill, that moved to quarantine their more profitable units from struggling businesses. The company had hoped to finish the transaction by the end of 2013.

Time Warner's management also considered selling some or all of its publishing titles -- it owns 95 brands, including Time, People, Sports Illustrated, InStyle, Fortune and Real Simple -- but it decided that a spinoff would give the companies' "clarity and flexibility," according to Time Warner's spinoff-related documents filed with the Securities and Exchanges Commission Thursday.

Time Inc. will have more focused executives overseeing its business and see opportunities to create incentives for its management and employees "that are more closely tied to its business performance and stockholder expectations," the company said.

As the largest U.S. magazine publisher, Time Inc. maintains more than a quarter of the domestic magazine advertising market. But its advertising sales have been declining for years.

In Time Warner's most recent quarterly earnings report, the company reported a slight uptick in Time Inc.'s revenue – up 1% to $745 million – but the increase was largely attributable to several magazines Time Inc bought from American Express in the fourth quarter of 2013.

Time Inc.'s advertising sales were flat for the quarter and operating loss widened to $120 million from $9 million a year ago.

To prepare for the spinoff, Time Inc. reshuffled its top management in 2013, appointing Joseph Ripp as CEO and Jeffrey Bairstow as CFO in September to oversee the transition. Their task is to devise "a new long-range plan" to extract more sales from digital properties, create other sources of revenues and stabilize operating income trends, Time Warner said.

To get leaner, the company has had several rounds of layoffs in recent months, including about 500 jobs cut in February. "We anticipate additional headcount reductions and real estate consolidations in the future," the company said Thursday.