Scripps Networks Interactive has agreed to buy Travel Channel International, the UK-based media company, in a £65m deal aimed at expanding the US broadcaster’s reach in Europe and Asia.
Privately held TCI distributes shows about exotic locations – such as Food Tripper and World’s Greatest Motorcycle Rides – to 75 countries in Europe, the Middle East, Africa and Asia in 21 languages.
Scripps already owns a controlling stakein the Travel Channel brand in the US, which it runs alongside networks including HGTV, Food Network, DIY Network and Cooking Channel. The two Travel Channel businesses had previously been part of the same company, until the international unit was separated out in a management buyout in 2004.
Richard Wolfe, chief executive and majority shareholder in TCI, said: “Combining TCI’s reach and resources in our territories with those of SNI’s US Travel Channel creates a new worldwide brand with powerful synergies in programming and advertising.”
Last August Scripps bought a 50 per cent stake in UKTV, the UK channel group behind brands including Watch, Gold and Dave for £239m, part of a strategy of internationalising the business.
Scripps is facing tough competition from rivals such as Walt Disney and the Discovery Channel, which have more money to spend on programming and marketing. Analysts have also been concerned that the company is too exposed to the US market, and advertising sales would falter if the US economic recovery loses momentum.
Last month, Scripps reported a 10 per cent increase in revenues to $2.1bn in 2011, but cautioned that its programming expenses would increase by 15 per cent and costs such as marketing would increase by up to 12 per cent, as the company attempts to reach new viewers.
London-based TCI had revenues of about £16m and earnings before interest, tax, depreciation and amortisation of £5.3m in 2011. The company’s 46 full-time employees in London are expected to join Scripps when the deal is completed.
“TCI brings unique value to us as we establish our brands in the global media marketplace,” said Kenneth Lowe, chief executive of Scripps Networks Interactive. “We’re enthusiastic about sharing our lifestyle programming expertise internationally, engaging a new set of passionate media consumers overseas, and increasing our footprint in Europe and Asia, building on the solid foundation we’ve established for the continued international growth of our brands.”
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