LGF.A Lions Gate Entertainment Corp

By Joe Flint 

CBS Corp. said it has acquired the 50% stake in the cable network Pop held by Lions Gate Entertainment Corp., giving it complete ownership of the channel.

Terms of the deal weren't disclosed. CBS acquired its initial 50% stake in the channel for $100 million in 2013 when it was known as the TV Guide Network. Since that purchase, the channel's ratings among key demographics have declined and its national reach has fallen by 15%.

Pop TV primarily carries reruns of sitcoms and dramas including "House," "The Goldbergs" and classics such as "Beverly Hills 90201."

The channel has also been spending more on original programming as of late. Its best-known original show is "Schitt's Creek" -- a comedy about a formerly wealthy family forced to move to a backwater town they own -- which has become something of a cult hit thanks in large part from viewers discovering old episodes on Netflix. Other original shows include the new dark comedy "Flack" starring Anna Paquin as a fast-living public-relations executive.

Like many cable networks, Pop has been hit hard by cord-cutting. In 2009, when Lions Gate acquired the channel for $255 million, it was available in nearly 85 million homes. Now it is available in 70 million homes, according to Lions Gate.

Ratings are also down, according to Nielsen. In 2018, Pop's total day audience average was 92,000 viewers, off nearly 10% from 2017 and flat compared with 2014. Among adults 18-49, the average daily audience is 26,000 viewers, a 21% drop from 2017 and a 16% decline from 2014.

Pop's prime-time audience last year was 155,000 viewers, a 10% decline from 2017. It was also down 10% in the 18-49 category.

When Lions Gate bought the channel, it had bold plans. It started to spend heavily on acquired and original programming and also saw it as a platform to promote its theatrical movies as well.

However, Pop struggled to attract big audiences. Other cable networks including AT&T Inc.'s Turner properties, 21st Century Fox Inc.'s FX and AMC Networks are all firmly established in that space, making it hard for newcomers to break through.

For Lions Gate, the decision to unload its stake in Pop is part of a broader strategy to focus its efforts solely on movie and television production, a person familiar with the matter said. It also shut down its direct-to-consumer channels Comic-Con HQ and Tribeca Shortlist in the past two years.

A Lions Gate spokesman said the studio will continue to produce content for Pop TV including the upcoming series "Florida Girls."

CBS's biggest cable holding is the premium channel Showtime. It also owns the Smithsonian Channel and CBS Sports Network.

Write to Joe Flint at joe.flint@wsj.com

(END) Dow Jones Newswires

March 12, 2019 14:25 ET (18:25 GMT)

Lions Gate Entertainment (NYSE:LGF.A)
Historical Stock Chart
From Mar 2024 to Apr 2024

Lions Gate Entertainment (NYSE:LGF.A)
Historical Stock Chart
From Apr 2023 to Apr 2024