Discovery to acquire Scripps Networks Interactive for $14.6B

Combined brands in the deal include Discovery Channel, Investigation Discovery, HGTV, Food Network and others.
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By Barry Walsh and Meagan Kashty

Discovery Communications is acquiring Scripps Networks Interactive for US$14.6 billion in a cash and stock transaction. The deal is expected to close by early 2018.

The combined company will produce and hold an impressive amount of content, including about 8,000 hours of original programming annually and 300,000 hours of library content. The pair will generate a combined seven billion short-form video streams monthly.

Discovery expects the combined group to create cost synergies of US$350 million, although the companies say it is too early to tell how these synergies will affect their flagship brands and if any of them will “go away.”

Instead, noted Kenneth Lowe, chair, president and CEO, Scripps Networks Interactive in an analyst call on July 31, the teams will first consider which brands might be better positioned as a different format and a different delivery.

Lowe is expected to join Discovery’s board of directors following the close of the transaction.

Scripps’ lifestyle-centric portfolio includes HGTV, Food Network, DIY Network, Cooking Channel, Travel Channel and Great American Country. Those networks should complement Discovery’s roster, which includes its flagship Discovery Channel as well as TLC, Animal Planet, Investigation Discovery, OWN: Oprah Winfrey Network, Science Channel, Destination America, Velocity and American Heroes Channel.

In Canada, Bell Media operates Discovery Communications’ brands including Investigation Discovery and Discovery Channel Canada, which just revealed its 2017/2018 schedule, while Corus Entertainment operates Scripps’ brands, including Food Network Canada and Cooking Channel Canada. When asked to comment on the deal, a representative for Bell Media said business will continue as usual.

“Corus has had a long-standing partnership with Scripps which we expect to continue moving forward. Discovery is an excellent company and we look forward to working with them more closely,” a spokesperson for Corus Entertainment told Playback Daily. 

Both Discovery and Scripps are also significant buyers of Canadian content. Last year, Scripps Networks Asia Pacific greenlit Peace Point Entertainment’s Inspired with Anna Olson and picked up three seasons of Farmhouse Productions’ home reno series Brojects. Meanwhile, Investigation Discovery recently commissioned three VR films from Toronto’s Cream VR and greenlit CMJ Productions’ Guilty Rich

According to a release, the combined brands in the deal include, from Discovery: Discovery Channel, TLC, Investigation Discovery, Animal Planet, Science and Turbo/Velocity, as well as OWN in the U.S., Discovery Kids in Latin America, and Eurosport. Scripps holdings in the deal include: HGTV, Food Network, Travel Channel, DIY Network, Cooking Channel and Great American Country, as well as TVN, UKTV, Asian Food Channel and Fine Living Network.

Discovery and Scripps discussed a potential merger twice before in recent years, most recently in 2014. Affiliates of Goldman Sachs will finance the cash portion of the deal.