Scripps Networks Buys 65% Stake In Travel Channel
Scripps Networks is buying a 65% stake in Cox Communications Inc.’s (COX) Travel Channel as of January 2010. This is a joint venture between Scripps and Travel Channel, with the value of the venture estimated at $975 million.
Scripps CEO chairman and president Kenneth Lowe stated “Combining the Travel Channel with Food Network and HGTV will make our fast-growing, young company the undisputed global leader in lifestyle programming”.
“Adding the Travel Channel, and its related enterprises, provides us with a unique opportunity to meaningfully expand our portfolio into a lifestyle category that’s highly desirable to media consumers, advertisers and programming distributors,” Lowe stated. “Our vision for Travel follows the same script that’s made Food Network and HGTV two of the most powerful brands in all of television.”
Scripps will spend $181 million in this partnership venture, paying $181 cash and the rest as a debt of $696 million for 65% of Travel Channel, with Cox retaining 35% of the channel. Scripps is the owner of Food Network and HGTV channels and outbid News Corp. to acquire a portion of Travel channel. Cox will be a contributor to the Travel channel.
The bidding competition began after Cox received unsolicited bids for the Travel Channel. Scripps has a national audience of 95 million in the United States. Their shows include “Anthony Bourdain: No Reservations,” “Man v. Food,” “Madventures” and “Most Haunted.” Scripps Network Interactive will be the controlling factor in the venture, with the Travel Channel part of Scripps lifestyle media brands.
Cox Chief Financial Officer Mark Bowser said in a statement “The two areas where we would see the largest opportunity would be international and would be digital”. At a September 16 investor conference Financial Officer Joseph NeCastro said his company was interested in the network because of the genre and size of the channel audience.
Scripps Networks is located in Cincinnati. Scripps Networks cable lifestyle channels include the popular cable channels DIY Network, HGTV and the Food Network. Goldman Sachs Group Inc. was hired in June 2009 to advise Cox on the Travel Channel acquisition.
