NEW YORK (TheStreet) -- Madison Square Garden (MSG) found a buyer for its Fuse Network music channel -- and came out on top in the deal. Former couple Jennifer Lopez and Sean "Diddy" Combs battled over Fuse, and J-Lo's cash and stock deal won the day.
Fuse's new owner is NuvoTV -- not a household name, but available in 32.7 million homes in the United States. NuvoTV is backed by shareholder Jennifer Lopez, who is chief content officer for the Latino-focused channel. With the acquisition of Fuse, NuvoTV's parent company SiTV Media gains a channel that reaches 73 million households.
Diddy and Lopez dated from 1999 to 2001.
The suitors for Fuse reportedly came down to Lopez's NuvoTV and Diddy's Revolt music video channel. Diddy offered $200 million and no equity in his channel, according to sources. NuvoTV bid $226 million in cash and 15% ownership of the shares of a combined Fuse-NuvoTV, plus a seat on the board of directors. This stake took MSG closer to the overall $400 million price they were reportedly seeking.
The deciding factor was likely cash, but the equity and possible upside in SiTV Media helped Madison Square Garden maximize its return.
SiTV plans on keeping the channels separate, but will use the combination as leverage in deals with cable providers. The ability to cross-promote and pair the channels for advertisers will also help SiTV's ambitions. SiTV rebranded its channel as NuvoTV in 2011 and brought in Lopez in 2012 to help boost the network and its popularity.