Mogul, One Equity shell out $255 million
Former Mosaic topper Allen Shapiro and One Equity Partners have bought the TV Guide Network from Macrovision for about $255 million.
Deal also includes the TVGuide.com website.
Shapiro, who had been hunting for his next investment after selling Dick Clark Prods. to Daniel Snyder’s Red Zone Capital in 2007, began kicking the channel’s tires this summer.
“It’s a fully distributed cable channel and comes with the trophy brand name — TV Guide is known everywhere,” Shapiro said. “These are very difficult assets to duplicate. It has a solid business foundation and solid financials.”
Shapiro and One Equity are expected to take over TV Guide Network by April. The final price is subject to a working capital adjustment at deal closing and also entails additional earn-out provisions through 2012 that could total $45 million.
Once he gains control, Shapiro said he plans to invest more in the channel’s programming output.
“We’ll clearly broaden the entertainment brand,” Shapiro said. “The future is this becoming a great entertainment channel.”
Part of that also means continuing to diminish the program listing scroll that’s still seen on the channel in much of the country. (TV Guide Network offers a separate feed without that program listing scroll that’s already distributed to satellite providers and some cable operators.)
“As the world goes digital, the scroll will become less important over time,” Shapiro said.
The owner also said it was too soon to discuss executive changes but added that “we are not passive shareholders; we’re active shareholders.”
In a statement, TV Guide Network prexy Ryan O’Hara said he believed the channel “will continue to develop and prosper. This transaction is really a win for all constituents.”
Net had been on the block since September but didn’t attract much serious interest at first. Macrovision had originally planned to sell the channel but hold on to the TVGuide.com website; instead, the website will now remain linked to the channel. Macrovision had originally included the site as part of its financial estimates for this year and next but is now moving it to the “discontinued operations” column.
The TVGuide.com domain was the center of a head-scratching transaction in October that saw Macrovision dump money-losing TV Guide magazine for $1 to OpenGate Capital. The magazine was decoupled from its website for the sale, with OpenGate and the mag’s editorial staff declaring their plan to launch TVGuideMagazine.com despite the fact that TVGuide.com will continue to exist.
Shapiro said he and his team haven’t yet met the new owners of the print mag but pointed out that the channel and Web domain are now more widely distributed than the magazine (which once upon a time boasted the nation’s largest magazine circulation but now reaches only 3.2 million subscribers).
“TV Guide Network is in 83 million homes,” Shapiro noted. “The channel and the dot-com have a much broader reach. If you talk to people of a younger generation, they identify TV Guide as the channel and the website.”
Meanwhile, Shapiro said he’s in acquisition mode and is looking for other properties to pair with the TV Guide Network.
“You notice our partner on this is One Equity, the private equity arm of JPMorgan,” he said. “They’re the strongest financial investment firm in the world right now, I believe. We bought this thinking this would be a platform for further strategic acquisitions.”
Shapiro’s entry closes the latest chapter of the once-storied TV Guide brand, following Silicon Valley-based Macrovision’s move to exploit the technology underlying the TV Guide-branded listings. It paid $2.3 billion for Gemstar-TV Guide in a deal that closed last May.
“We remain committed to delivering leading interactive program guide technology, data solutions and video search capability,” said Macrovision prexy-CEO Fred Amoroso.
Macrovision said it is on track to divest the last remaining TV Guide asset on the block, the horse racing channel TVG Network, early next year.
As president of Mosaic Media Group and CEO of Dick Clark Prods., Shapiro has served as an exec producer on events such as the Golden Globe Awards and series such as “So You Think You Can Dance.” Besides the Dick Clark sale, he also oversaw the sale of Mosaic Music Publishing in 2005.
Shapiro’s resume also includes serving as president-CEO of the IndieProd Co., which he sold to Carolco Pictures. He began his career in the office of the general counsel at Playboy Enterprises.
Peter Guber, who ran Mandalay Mosaic when Shapiro joined to oversee its Dick Clark Prods. division, said the exec “did a wonderful job for the investors, the brand and the employees. He understood what he needed to do with the asset, and I think he can do the same thing now (for TV Guide Network). I found him to be an effective, creative entrepreneur.”