A+E Close to Deal Turning H2 to Vice

A+E will handle channel's distribution, ad sales a joint effort
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A+E is close to closing a deal that turns its H2 cable network into a channel programmed by digital media company Vice, sources said.

A+E made a $250 million investment that gave it a 10% stake in Vice last year, but rebranding the channel has been held up because distributor DirecTV had not yet signed off on the change.

Vice will get a significant stake in the cable channel, but A+E will continue to own a majority interest. The cable network is valued at more than $700 million, and in return for the stake in the channel, A+E’s stake in Vice will rise to about 20%.

A+E will continue to handle distribution and logistics for the network. A+E and Vice will jointly sell advertising.

Vice will program the channel, and current H2 programming will air on A+E’s History channel. Working with Vice gives A+E a chance to expand its portfolio with content aimed at younger viewers. At the same time, Vice’s non-fiction programming is seen as compatible with the programming on A&E Networks and History, creating cross-promotional opportunities.

A+E is a joint venture of The Walt Disney Co. and Hearst. Disney is expected to also make a separate $200 million investment in Vice.

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