Hearst announced on Tuesday that it will acquire The Walt Disney Company’s 50 percent interest in A+E Global Media for approximately $1.2 billion in cash, moving the television and content operator into full Hearst ownership. The deal reflects a strategic shift by Disney away from some traditional TV holdings as it concentrates on streaming and its sports business, ESPN.
The companies expect the transaction to be completed in September. Once closed, A+E will be integrated as a wholly owned business within Hearst’s entertainment group, according to Hearst.
A+E, which operated as a 50-50 venture between Hearst and Disney, oversees a portfolio of television brands that includes A&E, Lifetime, The History Channel, LMN, FYI and Vice TV. The network group reaches more than 414 million households across some 200 territories and distributes content in 40 languages.
Paul Buccieri, president and chairman of A+E Global Media, said the company will continue to grow its content business across platforms and international markets following the change in ownership. That emphasis on platform and market expansion was highlighted as part of the rationale for the transaction.
Hearst Chief Executive Officer Steven Swartz said the company looks forward to supporting Buccieri and A+E’s leadership as they produce programming and pursue innovation around the History, Lifetime and A&E brands.
The deal comes as Disney narrows its portfolio to concentrate on streaming services and ESPN, while examining the role of certain traditional linear television assets in an environment of declining cable subscriptions. Hearst itself has a broad set of media and information interests, including television, newspapers, magazines, financial services and healthcare information businesses, and holds an 18 percent stake in ESPN.
With full ownership, Hearst will fold A+E into its entertainment group and pursue the stated goal of expanding content offerings internationally and across diverse distribution platforms. The companies provided no further financial pro forma detail in the announcement.
Context and next steps
The transaction remains subject to customary closing conditions and is expected to conclude in September. After the closing, A+E will operate as a wholly owned Hearst unit and continue to develop and distribute programming across its existing brand portfolio.