Media moguls set the stage for deal mania
The moguls are orchestrating corporate maneuvers that could usher in a sweeping reordering of the media industry in 2025
Published: 04:12 PM,Dec 13,2024 | EDITED : 08:12 PM,Dec 13,2024
The moguls are orchestrating corporate maneuvers that could usher in a sweeping reordering of the media industry in 2025
The people in charge of the world’s biggest media companies are setting the stage for a flurry of deal-making.
The moguls are orchestrating corporate maneuvers that could usher in a sweeping reordering of the media industry in 2025. Among them are the leaders of Warner Bros. Discovery, the parent company of CNN; Comcast, the owner of NBC; and John Malone, the influential investor behind Live Nation.
In addition, Paramount, the owner of MTV and Nickelodeon, could soon have a new owner in David Ellison, who has access to billions of dollars in capital that could be used to strike additional deals.
The starting gun went off in October, when Comcast President Michael Cavanagh said the company was exploring a spin-out of its cable networks, which include Syfy, USA and MSNBC, into a new company. Analysts expect the as-yet-unnamed company to go on a shopping spree, buying up smaller cable networks and peeling off channels from rivals.
Malone, the cable pioneer with stakes in many major entertainment companies, went next. In November, he replaced his longtime CEO, Greg Maffei, in tandem with a sale of the broadband business Liberty Broadband and a spin-out of Liberty Live, a major shareholder in the concert promoter Live Nation. Some of Malone’s investors think another merger, between Liberty Live and Live Nation, is in the offing.
On Thursday, Warner Bros. Discovery announced it was planning to reorganise its company into two big divisions, lumping its traditional TV networks into one group and its streaming and studio businesses into another. In its announcement about the change, the company said it would increase its “strategic flexibility,” corporate argot for creating options to buy and sell things. The company’s shares spiked 15% on the news, with investors expecting some kind of transaction.
The move was intended as a signal to potential suitors that the company was willing to entertain deal discussions, according to two people with knowledge of the company’s strategy.
“The climate for deal making is going to be really strong in 2025 for a lot of reasons,” said Reed Phillips, the co-founder and CEO of Oaklins, an investment bank for media, marketing and technology. “It’s a combination of a good economy, the uncertainty about the election being resolved, and there are a lot of companies that need to show growth again so that they themselves are attractive to investors.”
There is no shortage of smaller companies for these media mammoths to scoop up. The decline of traditional cable has created a clutch of small TV companies trying to navigate the industry-wide transition to video streaming. Those players, including AMC Networks, Hallmark Media and A&E Networks, are potential targets for the likes of Comcast and Warner Bros. Discovery.
There are also new players coming onto the scene that are interested in acquiring media companies. Antenna, a media company that owns a stake in the Saudi broadcaster MBC, has been exploring deals for English-language media companies, including the News Movement. Redbird IMI, a media company backed by the United Arab Emirates and run by former CNN chief executive Jeff Zucker, recently tried to purchase The Telegraph, the British newspaper.
Wall Street bankers have been gearing up for the prospect of a deal spree following the election of Donald Trump, who they anticipate will put up fewer regulatory roadblocks on deals than President Joe Biden.
David Zaslav, the CEO of Warner Bros. Discovery, told analysts on an earnings call in November that he was optimistic about prospects under the new administration.
“It may offer a pace of change and an opportunity for consolidation that may be quite different, that would provide a real positive and accelerated impact on this industry that’s needed,” Zaslav said.
Trump’s picks to lead the antitrust agencies, Gail Slater as assistant attorney general at the Justice Department and Andrew Ferguson at the Federal Trade Commission, have largely reassured dealmakers. Still, the pair have made it clear they will continue to closely scrutinise the kind of big technology companies, like Amazon, that may be buyers of media companies.
And some antitrust experts say that Slater and Ferguson could apply greater scrutiny to media companies that they believe have a liberal bias. Trump opposed AT&T’s acquisition of Time Warner Cable during his first term, a stance many attributed to his frustrations with CNN. A federal judge ultimately overruled the Justice Department’s opposition to the deal.
“The reality is that under a Trump administration,” said David Schwartz, a partner at the law firm Bryan Cave Leighton Paisner, “deals that are disfavored politically are likely to see significantly heavier scrutiny.” — NYT
The moguls are orchestrating corporate maneuvers that could usher in a sweeping reordering of the media industry in 2025. Among them are the leaders of Warner Bros. Discovery, the parent company of CNN; Comcast, the owner of NBC; and John Malone, the influential investor behind Live Nation.
In addition, Paramount, the owner of MTV and Nickelodeon, could soon have a new owner in David Ellison, who has access to billions of dollars in capital that could be used to strike additional deals.
The starting gun went off in October, when Comcast President Michael Cavanagh said the company was exploring a spin-out of its cable networks, which include Syfy, USA and MSNBC, into a new company. Analysts expect the as-yet-unnamed company to go on a shopping spree, buying up smaller cable networks and peeling off channels from rivals.
Malone, the cable pioneer with stakes in many major entertainment companies, went next. In November, he replaced his longtime CEO, Greg Maffei, in tandem with a sale of the broadband business Liberty Broadband and a spin-out of Liberty Live, a major shareholder in the concert promoter Live Nation. Some of Malone’s investors think another merger, between Liberty Live and Live Nation, is in the offing.
On Thursday, Warner Bros. Discovery announced it was planning to reorganise its company into two big divisions, lumping its traditional TV networks into one group and its streaming and studio businesses into another. In its announcement about the change, the company said it would increase its “strategic flexibility,” corporate argot for creating options to buy and sell things. The company’s shares spiked 15% on the news, with investors expecting some kind of transaction.
The move was intended as a signal to potential suitors that the company was willing to entertain deal discussions, according to two people with knowledge of the company’s strategy.
“The climate for deal making is going to be really strong in 2025 for a lot of reasons,” said Reed Phillips, the co-founder and CEO of Oaklins, an investment bank for media, marketing and technology. “It’s a combination of a good economy, the uncertainty about the election being resolved, and there are a lot of companies that need to show growth again so that they themselves are attractive to investors.”
There is no shortage of smaller companies for these media mammoths to scoop up. The decline of traditional cable has created a clutch of small TV companies trying to navigate the industry-wide transition to video streaming. Those players, including AMC Networks, Hallmark Media and A&E Networks, are potential targets for the likes of Comcast and Warner Bros. Discovery.
There are also new players coming onto the scene that are interested in acquiring media companies. Antenna, a media company that owns a stake in the Saudi broadcaster MBC, has been exploring deals for English-language media companies, including the News Movement. Redbird IMI, a media company backed by the United Arab Emirates and run by former CNN chief executive Jeff Zucker, recently tried to purchase The Telegraph, the British newspaper.
Wall Street bankers have been gearing up for the prospect of a deal spree following the election of Donald Trump, who they anticipate will put up fewer regulatory roadblocks on deals than President Joe Biden.
David Zaslav, the CEO of Warner Bros. Discovery, told analysts on an earnings call in November that he was optimistic about prospects under the new administration.
“It may offer a pace of change and an opportunity for consolidation that may be quite different, that would provide a real positive and accelerated impact on this industry that’s needed,” Zaslav said.
Trump’s picks to lead the antitrust agencies, Gail Slater as assistant attorney general at the Justice Department and Andrew Ferguson at the Federal Trade Commission, have largely reassured dealmakers. Still, the pair have made it clear they will continue to closely scrutinise the kind of big technology companies, like Amazon, that may be buyers of media companies.
And some antitrust experts say that Slater and Ferguson could apply greater scrutiny to media companies that they believe have a liberal bias. Trump opposed AT&T’s acquisition of Time Warner Cable during his first term, a stance many attributed to his frustrations with CNN. A federal judge ultimately overruled the Justice Department’s opposition to the deal.
“The reality is that under a Trump administration,” said David Schwartz, a partner at the law firm Bryan Cave Leighton Paisner, “deals that are disfavored politically are likely to see significantly heavier scrutiny.” — NYT