NuvoTV to Acquire Fuse for $226 Million
UPDATED: NuvoTV, where Jennifer Lopez serves as chief creative officer and owns a minority stake, reached a deal to buy the cable channel from the Madison Square Garden Company.
NuvoTV, the English-language cable channel where Jennifer Lopez is a minority owner and serves as the network’s chief creative offer, has reached an agreement to acquire Fuse from Madison Square Garden Company for $226 million.
"Music is my first love so the acquisition of Fuse is near and dear to my heart," Lopez said in a statement. "It’s exciting that between NUVOtv and Fuse we’ll have the ability to deliver a broad array of terrific content both from a Latino perspective and across multiple genres, including music, to a broader audience. The acquisition of Fuse means we now own two wonderful assets. It’s a phenomenal time for our company and we look forward to growing both networks in the years ahead."
The deal is expected to close between July 1 and September 1.
"The acquisition of Fuse represents a transformational event for us and also provides significant benefits to NUVOtv," said Michael Schwimmer, CEO of NUVOtv network parent company SiTV Media. "It enhances our distribution relationships, dramatically expands our aggregate subscriber base, provides substantial economies of scale, affords unique opportunities for programming and cross-promotion and should be extremely appealing to the advertising community as we roll out our plans for both NUVOtv and Fuse."
Prior to Lopez's NuvoTV reaching a deal, Sean “Puffy” Combs, backed by billionaire supermarket magnate Ron Burkle, had reportedly made a $200 million offer.
The assumption in the industry that Lopez and Combs, who owns the fledgling Revolt TV cable channel in partnership with Comcast, were interested in acquiring Fuse to convert the struggling network to their respective programming formats and gain access to Fuse’s 74 million cable households. (NuvoTV and Revolt reportedly reach in the neighborhood of 34 million households.)
But in an interview that took place on Wednesday, before the deal was reached, Lopez’s manager Benny Medina, in a conversation about JLo’s entrepreneurial branding strategy, said that if NuvoTV emerged the victor, there were no immediate plans to change Fuse’s format. “We do look at these channels as two different companies with two different identities, audiences and goals,” Medina said. “And these shall remain intact.”
The plan to maintain Fuse’s format for the time being may have to do with something called a “definition of service” clause that cable operators can include in their contracts with the services they carry.
According to one cable television-industry source, the clause enables operators to drop a network or decrease the fees paid for carriage if the network’s ownership or programming format changes. This could prove to be a synergistic stumbling block given that Fuse’s music-video heavy programming does not bear much resemblance to NuvoTV’s largely non-musical slate of programs, which include reruns of Dexter and the new boxing reality show Knockout.
Asked if Lopez and Combs’ competing bids for Fuse was a coincidence or a residual effect of their two-year affair that began in 1999 -- Combs once likened his tumultuous relationship with Lopez to Frank Sinatra and Ava Gardner’s romance -- Medina replied, “I don’t think it’s a coincidence,” but added that it had nothing to do with their past history.
“In many ways, Jennifer and Sean are cut from the same cloth,” Medina said. They’re both passionate artists of the same generation who think on a grand and global scale. They were two superstars seeking to build their brand, who happened to be Jennifer and Puffy.” (They're also both 44 years old.)
He says that Lopez’s transition from the recording studio to the boardroom of NuvoTV “is a conscious move” and part of a larger strategy to build businesses around her that can sustain a lot of what she does as an entertainer and actor.” In addition to her music and acting career, Lopez sells her Jennifer Lopez fashion line through the Kohl’s department store chain and collaborates with Coty on a number of fragrances.
“We’re in an age and time now where artists have to be a lot more involved, invested and creative in marketing and promoting themselves, whether its fashion brands and fragrances that speak to who they are -- or a cable TV network. It’s about building a business around the art.”
Despite Lopez's evolution as an entrepreneur, Medina says her recording career has not taken a backseat. "She is working on her 10th album," he says. "Her first love is music."