German broadcasting group ProSiebenSat.1 has decided to keep its transatlantic production subsidiary Red Arrow Studios after determining that a sale or partial sale of the group was no longer possible due to the ongoing coronavirus crisis.
The media giant launched a strategic review of the production and distribution division in September with the aim of selling it or forming a partnership with other potential investors.
A final decision had been expected at the end of 2019 but the group said in December that it was postponing it until some time in the first quarter of 2020. ProSiebenSat.1 will now hold on to Red Arrow for the long term.
“We have now closed the process for the strategic review of Red Arrow Studios as various options we were evaluating are no longer viable in a coronavirus crisis environment,” a ProSiebenSat.1 spokesperson said. “We strongly believe in the business. It posted a record 2019. ‘Love is Blind’ is the smash hit on Netflix to just name one of our great lineup. We have a great team. And we are all in and will remain so.”
Red Arrow Studios comprises 20 production companies in Europe, the U.S. and Israel that make scripted and unscripted shows like Netflix’s new docu-drama “Rise of Empires: Ottoman” and CBS All Access’ true-crime series “Interrogation.”
Red Arrow Studios’ overall production business generates some €550 million ($611 million) in annual revenues for ProSiebenSat.1. Analyst valuations had initially put the estimated price tag for the division at €300 million ($333 million).
All3Media, the U.K. company owned by Discovery and Liberty Global, is said to have been a leading contender for Red Arrow Studios. Other companies that had reportedly eyed the unit included AMC, Sony Pictures Television, Banijay and Vivendi.
Red Arrow Studios’ U.S. companies include Fabrik Entertainment, producer of “Interrogation” and Amazon’s “Bosch,” Karga Seven Pictures, maker of “Rise of Empires: Ottoman,” Kinetic Content and 44 Blue Productions as well as Endor Productions and Cove Pictures in the U.K. Its German production assets, which were not included in the original sales plan, include Redseven Entertainment, maker of ProSieben and Sat.1 shows such as “Germany’s Next Top Model” and “The Biggest Loser.”
The coronavirus crisis has hit the German and European entertainment industries hard. At ProSiebenSat.1’s Munich headquarters, staffers have been dealing with the pandemic and examining possible home office solutions.
News of the Red Arrow Studios decision followed the announcement on Friday that ProSiebenSat.1 deputy CEO Conrad Albert was stepping down from his post on April 30 with mutual consent.
Albert has been at the group for 15 years, initially serving as general counsel before being appointed to the executive board in 2011. He has been deputy CEO since 2017.