This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Viacom Buys U.K's Channel 5 for $757M

LONDON (The Deal) -- Sumner Redstone's Viacom (VIA - Get Report) is to branch out into free-to-air advertising-led TV in the U.K. with an agreement to acquire British broadcaster Channel 5 from Northern & Shell Media Group for 450 million POUNDS ($757 million).

The deal, announced Thursday, May 1, will deliver Northern & Shell's owner, the down-market-media mogul Richard Desmond, a return of over four times his 2010 investment in the company, which he bought from RTL Group plc for 103.5 million POUNDS.

Viacom said the price will be financed from Viacom's existing cash balances and the transaction, which is still subject to regulatory approvals, is expected to be accretive immediately after closing.

Nasdaq-listed Viacom also announced quarterly results Thursday, reporting total debt of $13.38 billion as of March 31 and $2.58 billion cash on its balance sheet. It added that it had redeemed $600 million of outstanding 4.375% senior notes due September 2014 subsequent to the end of the quarter

Desmond, the publisher of the tabloids Daily Express and Daily Star and the celebrity gossip magazine OK!, has fed his TV audience on a diet of reality TV, bought-in crime dramas, including the CSI franchise and The Mentalist, and Australian soaps. His four year tenure has left the business in better shape financially.

"Since Northern & Shell's acquisition of Channel 5 in 2010, the financial and operating performance of the business has been transformed with improved audiences and content offering," said Channel 5 chief operating officer Paul Dunthorne in a statement. "The combination of Channel 5 with Viacomm's global resources, technology and expertise adds further to the momentum of the business and offers numerous exiting opportunities for the channel's future."

Viacom president and CEO Philippe Dauman explained that the deal would both introduce Viacom content to U.K. audiences and bring the resources to generate new content locally and available for international distribution.

"The deal will dramatically increase Viacom's investment in content produced in the U.K., which has a widely admired public service broadcasting culture and a globally influential production sector," he said in the same statement. "We look forward to partnering with local producers to introduce more U.K. created content to global audiences and will continue to explore opportunities in the U.K. both in the free-to-air and pay television markets."

Northern & Shell was advised by Barclays plc and Ian Rosenblatt, Chris Pulham and Jon Lovitt of the London law firm Rosenblatt Solicitors, which also advised Northern & Shell on the original acquisition.

Viacom was advised by Goldman, Sachs & Co., and the law firms Shearman & Sterling LLP, Olswang LLP and Lewis Silkin LLP.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
VIA $71.20 -1.03%
AAPL $128.54 -0.63%
FB $80.90 1.63%
GOOG $573.37 -0.05%
TSLA $202.44 1.44%

Markets

DOW 18,096.90 -106.47 -0.58%
S&P 500 2,098.53 -9.25 -0.44%
NASDAQ 4,967.1410 -12.76 -0.26%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs