Scripps Networks Wins Travel Channel Bidding
Company will gain a 65% stake in the Cox-owned service
By Claire Atkinson -- Broadcasting & Cable, 11/5/2009 10:05:32 AM
Scripps Networks Interactive is to buy a 65% stake in Cox Communications Travel Channel, the company said November 5. The deal is expected to be complete by January 2010. (Due to the announcement, Scripps Networks Interactive said it will delay reporting its third-quarter earnings until Friday, Nov. 6.)
Scripps beat out other contenders including News Corp. and private equity firm Providence Equity (the latter had wanted to work with Discovery Communications, which still provides services to Travel Channel, once part of its corporate family). The network joins Scripps' lifestyle channels Food Network and HGTV.
The Travel Channel was valued at $975 million. Scripps will contribute $181 million in cash to a newly created partnership, according to the release. The partnership, in turn, will take on $878 million in third-party debt that will be guaranteed by Scripps and indemnified by Cox, with the proceeds to be distributed to Cox. The transaction will result in the partnership having about $696 million in net debt.
"Combining the Travel Channel with Food Network and HGTV will make our fast-growing, young company the undisputed global leader in lifestyle programming," said Kenneth W. Lowe, chairman, president and chief executive officer of Scripps Networks Interactive. "This collection of popular lifestyle networks will be in great demand worldwide and promises to create substantial long-term value for all of our stakeholders.
