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Time Inc. Spin-off Puts Publisher on Hot Seat, Moody's Sala Says


Time Inc. begins trading Friday as a separate company, a transaction that will force the country's largest magazine publisher to seek profitability without the protection of its longtime parent, Time Warner. Moody's Investor Service's Carl Salas says that although Time will begin trading with a debt rating below investment grade, the publisher's cash flow can provide it both the resources to pay down its $1.4 billion debt load and invest in its web sites and mobile applications. Salas points to News Corp.'s recent acquisition of Harlequin as evidence that a separately-traded legacy print publisher can use its cash flow to make valuable acquisitions.