“American Idol” producer Core Media Group is undergoing a management overhaul as the company tries to hammer out a refinancing deal for more than $300 million in debt.
Jennifer O’Connell is exiting as the company’s head of U.S. Television. Matt Sharp, CEO of Core’s Sharp Entertainment banner, will now oversee all development and production for Core’s TV efforts, both scripted and unscripted.
Core Media Group is formally part of the joint venture that its former majority owner, private equity giant Apollo Global Management, struck last year with 21st Century Fox — a merger that combined Apollo’s Endemol and Core with Fox’s Shine Group. But in fact, Core’s operations have remained at arm’s length from Endemol and Shine, which have fully merged into a single unit with production-distribution outposts around the world. Core functions within the joint venture fall under a shared-services agreement for select back-office support systems. But Core’s capital structure is entirely separate from the newly minted Endemol Shine Group, undoubtedly because of its heavy debt load.
In June Core missed a debt payment for one of its two outstanding $160 million second-lien loans tied to Core, as reported by financial news outlet the Deal. That prompted a downgrade on the company’s debt from Standard & Poor’s. A source close to the situation said the decision to skip the debt payment was deliberate and done as part of Apollo’s refinancing push, not because of a liquidity crisis. In recent months Apollo has made headlines for playing hardball on a refinancing plan on another one of its debt-laden properties, Caesars Entertainment, parent company of Las Vegas’ Caesars Palace.
At Core, industry sources say the company has been mostly dormant for the past few months as execs sort out its future prospects. O’Connell, a former executive with Shed Media and NBC, had run TV operations since joining Core in October 2012. Among the shows that Core fielded on O’Connell’s watch were Bravo’s “Euros of Hollywood,” Lifetime’s “Preach” and “Prison Wives Club” and OWN’s “Love in the City.”
Other Core TV executives have departed in recent months, including Jenny Ramirez, VP of development and production. Ramirez joined Irwin Entertainment as senior VP earlier this week.
Sharp is in the process of recruiting a handful of new execs, including two from the Endemol and Shine camps. Lyle Smith recently signed on as senior VP of production; he had been with Endemol’s 51 Minds banner. Mike Aho is coming aboard for a top development post; he had been senior VP of factual entertainment at Shine America.
New York-based Sharp Entertainment also plans to expand its reach with the opening of a West Coast office in the near future.
Apollo’s investment in Core began in 2011 when it acquired what was then the publicly held CKX Inc. for about $510 million. At the time, CKX was flush with the success of “American Idol” and “So You Think You Can Dance” — the Fox programs that it has a stake in through its ownership of Simon Fuller’s 19 Entertainment. CKX also owned the rights to the names and likenesses of Elvis Presley and Muhammad Ali.
The company’s name was changed to Core Media Group after NBC Entertainment alum Marc Graboff was tapped as president in early 2012. At the time Apollo indicated it was planning to build up the company’s production capabilities through acquisitions. Sharp Entertainment, a busy producer of unscripted cable series, was scooped up in July 2012.
But “Idol” went into a sharp decline — the show is preparing for its farewell season on Fox next year — and Core opted to sell off its rights to the Presley and Ali likenesses. Meanwhile, Apollo was consumed with the even larger debt crisis at Endemol, which spurred the discussions with Fox about the joint venture. That deal took nearly a year to assemble and move through necessary regulatory approvals in the U.K. But once the management structure began to fall into place last fall, Graboff stepped down as Core president. He joined Discovery Communications in March as head of its studio, business and legal affairs.
Graboff’s role at Core was filled by Peter Hurwitz, the company’s former exec VP and general counsel. Hurwitz previously held the same role at Martha Stewart Living Omnimedia and at the Weinstein Co.
Industry insiders have speculated that once Core’s debt problems are alleviated, its remaining assets will be folded into Endemol Shine Group, if only to eliminate redundancies. However, sources close to the situation downplay that scenario, at least in the near future.
A rep for Core Media Group declined comment for this story.