AMC pays $1bn for Chellomedia

AMC Networks is to acquire cable giant Liberty Global’s content business Chellomedia for US$1bn.

US-based AMC, whose flagship channel is home to series including Breaking Bad, Mad Men and The Walking Dead, and also owns the Sundance Channel, will pick up assets including Chello Multicanal, Chello Central Europe, ChelloZone, Chello Latin America and Chello DMC.

The firm will also get its hands on Chellomedia’s stakes in joint ventures with CBS International, A+E Networks and Zon Optimus.

Liberty Global will retain its Dutch premium channel business, which consists of its Film1 and Sport1 channels.

The move provides AMC with a chance to further expand the distribution of its original programming from AMC, IFC, Sundance Channel and WE tv across an expansive global footprint.

Josh Sapan, president and CEO of AMC Networks, said: “As AMC Networks has expanded internationally, we have had a great desire to do something we consider fundamentally strategic, which is to take our content and put it on channels we own.

“This acquisition allows us to secure a large, global platform on which to distribute our increasingly successful original programming through a collection of strong, well-established and well-managed assets worldwide.”

Liberty has been rapidly expanding its business in Europe in recent months, paying £15bn (US$23.3bn) for UK cable company Virgin Media in June and last week increased its bid to takeover Dutch cable broadcaster Ziggo TV.

Reports that Liberty was planning a sale of its content business first surfaced earlier this year.

“Chellomedia is one of the largest international channel groups with distribution to more than 390 million households in 138 countries and I have no doubt that the management team will continue to build tremendous value as part of AMC,” said Liberty Global president and CEO Mike Fries today.

“For Liberty Global, this transaction is attractive from both a valuation and liquidity perspective. It also simplifies our business and allows us to focus on our core markets and more strategic programming opportunities.”

The company said it expects cash proceeds from the transaction to generate enterprise value of €750m (US$1bn). The assets being divested generated approximately €350m of revenue during the 12 months ending June 30.

The sale is expected to be concluded in the first quarter of 2014 subject to certain conditions, and is not subject to any regulatory approval.