Viacom to buy Channel 5 for 450MN
Editor | 01-05-2014
While many assumed BSkyB would swoop following Discovery's withdrawal from the bidding race, Viacom has swept in to acquire UK broadcaster Channel 5.

Even though Channel 5 owner Richard Desmond will not get the 700 million he was reportedly looking for in the sale of the UK's fifth largest broadcasting outfit, he will receive more than four times the initial investment of 103 million made by his Northern & Shell company in 2010. Under Desmond's stewardship, Channel 5 heavily cross-promoted by Desmond's stable of UK newspapers returned to profitability and posted operating profits of 20.6 million in the first half of 2013 compared with a 16.1 million loss a year earlier.

"Since Northern & Shell's acquisition of Channel 5 in 2010, the financial and operating performance of the business has been transformed with improved audiences and content offering," commented Channel 5 COO Paul Dunthorne. "The combination of Channel 5 with Viacom's global resources, technology and expertise adds further to the momentum of the business and offers numerous exciting opportunities for the channel's future."

The Channel 5 portfilio will incliude not only the core channel itself but also the multichannel 5* and 5USA services, the Milkshake! pre-school children's programming offering and the Demand 5 video-on-demand service, which is claimed to be offered on more viewing platforms than any other commercial broadcaster in the UK, and delivered over 23 million views in January 2014.

Viacom - which boasts media networks reaching approximately 700 million global customers watching including MTV, VH1, CMT, Logo, BET, CENTRIC, Nickelodeon, Nick Jr, TeenNick, Nicktoons, Nick at Nite, COMEDY CENTRAL, TV Land, SPIKE, Tr3s, Paramount Channel and VIVA - says the transaction will provide it with the "programming grid prominence" associated with Channel 5's public service broadcaster status, and will complement its pay-TV networks. It believes that its global resources, technology and expertise would help Channel 5 develop "more compelling programming" and provide content to consumers "in exciting new ways."

"The acquisition of Channel 5 accelerates Viacom's strategy in the UK, one of the world's most important and valuable media markets," commented Viacom President and CEO Philippe Dauman. "Channel 5's momentum is indisputable, with impactful programming, increasing popularity and a growing digital platform. Channel 5's management and employees have done an outstanding job building their brand and we are pleased to welcome them to our team."