One of the most iconic brands in TV might soon have a new owner – for the second time in less than a year.
Dick Clark Productions, a Santa Monica company that produces live awards shows such as the Golden Globes and Academy of Country Music Awards, is among the assets being considered for possible divestiture by owner Eldridge Industries.
DCP and several other media assets, including The Hollywood Reporter, Billboard, and AdWeek were acquired in December from Guggenheim Partners by the Beverly Hills holding company created by Todd Boehly when he left his post as president of Guggenheim.
Eldridge recently received unsolicited interest in one of those properties, prompting Boehly to hire Moelis & Co. and Goldman Sachs to conduct a strategic review of all of its media holdings.
“When you hire major investment banks, it’s code for ‘We’re for sale,’” said Lloyd Greif, chief executive at downtown investment banking firm Greif & Co.
While the review is still in the early stages, the result might be more acquisitions, partnerships, or divestitures of its properties. DCP and Eldridge’s other media assets together have an estimated valuation of more than $1 billion, according to Greif.
Boehly seems open to all possibilities.
“For several years now, I have been involved in developing and executing a strategy of developing and repurposing global media brands and live events,” Boehly said in a statement. “Last year’s acquisitions by Eldridge of Dick Clark Productions, Billboard, (the) Hollywood Reporter, and other media assets were part of this strategy.”
While Eldridge representatives declined to confirm whether specific assets were being sold, interest in the live show production business is likely prompting the strategic review, which was first reported by Reuters. The media holdings will most likely be split off in a piecemeal fashion in order to unlock the most value for Eldridge.
Dick Clark Productions alone is estimated to be worth between $700 million and $900 million.
“You wouldn’t bring in Goldman and Moelis if this was about a smaller asset,” noted Greif, who said that if patterns held any transaction driven by the strategic review at Eldridge would likely close in 90 to 120 days.
Historic interest
DCP, which was founded by the late radio and TV host Dick Clark in 1957, was acquired by Guggenheim for an estimated $375 million in 2012. It is helmed by Chief Executive Allen Shapiro through a partnership with Peter Guber’s Mandalay Entertainment.
“Most of DCP’s value comes from its existing contracts with major networks,” said Mark Goldstein, a music industry professor at USC’s Thornton School of Music and a former record company executive. “Awards shows are pretty much the only thing people still watch on network TV.”
DCP and the Hollywood Foreign Press Association have an agreement with NBC to air the Golden Globes until 2018.
Television personality and producer Ryan Seacrest, who hosts the DCP-produced “Dick Clark’s New Year’s Rockin’ Eve,” expressed interest in the company in 2012 and could again emerge as a bidder. Seacrest and CBS Corp. were both bidders when the company sold in 2012, but dropped out when the price reached more than $300 million.
Walt Disney Co.’s ABC Television Group, another potential buyer, is developing upcoming music series “For the Record Live” with DCP.
Representatives of Seacrest and ABC did not return requests for comment.
Other potential bidders might come from the ranks of those frustrated by the on-again, off-again efforts to sell a stake in Viacom Inc.’s Paramount Pictures Corp., a process that has been beset by boardroom infighting.
That could open the door for a foreign buyer with an eye on acquiring an American media property to take a closer look at Dick Clark Productions, Greif said.
“American pop culture – especially music – does very well overseas,” he added.
Chinese e-commerce giant Alibaba Group was rumored to be a potential suitor for Paramount and could be among those interested in DCP, as could Chinese media and real estate conglomerate Dalian Wanda Group.
Print consolidation?
Penske Media Corp., which owns Hollywood Reporter competitor Variety and a number of other media properties that cover the entertainment industry, would be a logical buyer for Eldridge’s trade publication portfolio. However, Greif said, Penske could become a seller, too.
Representatives of Penske declined to comment.
AdWeek is another asset with the potential to be sold. Ken Fadner, who previously ran the publication, reportedly had interest in bringing it into the fold of his company, MediaPost Communications Inc., which owns outlets covering the advertising and marketing industries.
Boehly’s plan when he took the media holdings out of the Guggenheim portfolio apparently anticipated selling the Reporter, there just weren’t any buyers. But it’s become much more profitable than it was even six months ago. Similar to DCP, most of what’s driving its profitability is the growth of its live events business.
Since the arrival of Chief Creative Officer Janice Min in 2010, the Reporter has become a much more consumer-friendly publication, switching from a daily to a glossy weekly later that year. She also introduced a number of events such as the Power Women Breakfast to add value for industry insiders who might be too busy to read the print product.
Min also helped usher in a new era for Billboard. The Billboard brand name has long been associated with its music charts, which at one time were revered by music company executives as an important metric of success.
Billboard’s weekly print product now has a circulation of 17,000 but boasts more than 15 million unique visitors to its website a month, according to press materials.
