Byron Allen's Company Buys Weather Channel for $300 Million
March 22 2018 - 5:45PM
Dow Jones News
By Joe Flint
Comedian-turned-media-entrepreneur Byron Allen has struck a deal
to acquire the Weather Channel from Comcast Corp. and
private-equity firms Blackstone Group LP and Bain Capital for $300
million.
Mr. Allen said Thursday that he is buying the Atlanta-based
television network through his company, Allen Media LLC.
The head of Entertainment Studios Inc., which owns eight cable
networks such as Pets.TV and Comedy.TV and produces movies and
television shows, Mr. Allen said the widely distributed Weather
Channel will provide leverage to grow the rest of his holdings.
"It is a stronger relative to help pull us along," Mr. Allen
said. He plans to acquire other independent media assets to better
position his company in the wake of consolidation among bigger
media firms, including AT&T Inc.'s purchase of satellite
broadcaster DirecTV and proposed acquisition of Time Warner Inc.,
which is being challenged in court by the Justice Department.
Once in more than 95 million homes, the Weather Channel's
national distribution has fallen over the last decade to just over
80 million homes. Much of the subscriber losses can be attributed
to consumers cutting the cord to their traditional pay-TV packages
in favor of lower-priced streaming services, an issue facing cable
networks across the dial.
The Weather Channel does have its own unique set of issues that
could make growth challenging. Weather information is now readily
available to consumers via mobile devices. Efforts by the Weather
Channel to go beyond rain and snow and into entertainment and
reality programming have fallen flat, and cable and satellite
operators have squeezed the network to lower its distribution
fees.
Mr. Allen said he doesn't plan major changes in the network's
format beyond more investment. "An app can only for the most part
tell you what the temperature is, it can't give you the in-depth
information you need to navigate you and your family's life," he
said.
For Comcast, Bain and Blackstone, the sale ends a
less-than-stellar run with the Weather Channel assets.
NBCUniversal, then owned by GE, along with the private-equity firms
purchased the Weather Channel from closely held Landmark
Communications in 2008 for about $3.5 billion. Comcast inherited
NBCUniversal's 25% stake in the Weather Channel when it bought
NBCUniversal from GE. In 2015, the owners sold the digital assets
to IBM for around $2 billion.
The involvement of Comcast and Mr. Allen in a deal is a case of
strange bedfellows. Mr. Allen's Entertainment Studios filed a $20
billion racial discrimination lawsuit in 2016 against Comcast, a
case that is still going through the appeals process. That suit
alleged Comcast didn't comply with an agreement it made to the
Federal Communications Commission to launch new networks with
African-American ownership as part of getting approval to purchase
NBCUniversal.
Mr. Allen said he is continuing with his suit against Comcast
and that the Weather Channel purchase isn't related to his legal
fight.
A Comcast spokesman declined to comment the company's legal
fight with Mr. Allen.
Mr. Allen is also in a similar fight with Charter Communications
Inc.
He said one of the suits will be settled and the other one he
will "take all the way." Asked which he would settle, Mr. Allen
said, "That depends on them."
A Charter spokeswoman declined to comment on the company's legal
issues with Mr. Allen.
Jaewon Kang contributed to this article.
(END) Dow Jones Newswires
March 22, 2018 17:30 ET (21:30 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
Comcast (NASDAQ:CMCSA)
Historical Stock Chart
From Mar 2024 to Apr 2024
Comcast (NASDAQ:CMCSA)
Historical Stock Chart
From Apr 2023 to Apr 2024