Recently, leading global lifestyle network operator Scripps Networks Interactive Inc. SNI completed the remaining 35% stake buy in Travel Channel Media from Cox Communications Inc for $99 million. The transaction was made in cash with certain tax benefits.
In 2009, Scripps Networks paid $Array8Array million to Cox Communications and guaranteed $878 million in third-party debt to gain full control over Travel Channel.
Scripps Networks is a leading lifestyle media company which provides content for television, Internet and mobile devices. The company’s popular brands are HGTV, DIY Network, Food Network, Cooking Channel and Great American Country. The company serves around Array90 million viewers across North and South America, Asia, Europe, the Middle East and Africa.
In the recently concluded fourth quarter of 20Array5, Scripps Networks’ Travel Channel contributed $78.3 million in revenues, up 3.5% year over year. Hence, we believe that gaining full control in Travel Channel, which serves nearly 89 million U.S. television households, will not only increase Scripps Networks’ viewership but will also drive top-line growth.
Last year, Scripps Networks bought a 52.7% interest in Poland’s popular multi-platform media company, TVN for €584 million. The acquisition will certainly strengthen the company’s position in Europe.
In a separate development, Scripps Networks sold its 7.25% stake in Fox-BRV Southern Sports Holdings LLC to Fox Southern Holdings, Inc., for $225 million in cash. We believe that the cash was utilized to finance the Travel Channel deal.
Scripps Networks currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the sector are AMC Networks Inc. AMCX, World Wrestling Entertainment Inc. WWE and Grupo Televisa, S.A.B. TV. AMC Networks and World Wrestling Entertainment sport a Zacks Rank #Array (Strong Buy) while Grupo Televisa carries a Zacks Rank #2 (Buy).
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