Discovery Communications Completes $1.7 Billion SBS Nordic Acquisition

UP: David Zaslav
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The Discovery Communications CEO rides a surging stock price to $42.6 million in 2010 compensation, nearly four times what he made the previous year.

The cable networks group will combine the former ProSiebenSat.1 operations with its own Scandinavian business under the name SBS Discovery Media.

Discovery Communications said Tuesday that it has completed the acquisition of the SBS Nordic unit of German broadcaster ProSiebenSat.1, which it had first announced in December.

In the $1.7 billion deal, the cable networks group will combine the acquired operations with its own Scandinavian business under the new name SBS Discovery Media. The business includes 20 TV networks, including 12 newly acquired ones, as well as radio and digital brands across Denmark, Norway, Sweden and Finland.

Henrik Ravn, who has led the SBS Nordic business since 2009, will oversee the combined operation as president and managing director of SBS Discovery Media, the company said.

The deal in Scandinavia, together with the acquisition of a 20 percent stake in pan-European sports channel Eurosport, marks a $2 billion bet that the European expansion can help accelerate Discovery's growth.

The deals make Discovery the leading international TV group in Europe. Viacom generated $741 million in revenue from Europe in 2012, according to U.K.-based research firm Digital TV Research, while Discovery made $570 million in the region. But adding in SBS Nordic, whose revenue amounted to about $626 million in 2011, put Discovery ahead of Viacom in Europe.
“The formation of SBS Discovery Media solidifies Discovery’s long-term growth in some of the most well-penetrated and stable TV markets in the world, while also expanding Discovery’s brand portfolio by adding scripted entertainment programming to the company’s suite of genres,” said Discovery president and CEO David Zaslav. "This acquisition, along with the recent announcement of Discovery’s equity stake in Eurosport, is a continuation of a 25-year strategy of investing internationally to build the most extensive global footprint in media and extending our presence in key markets to support long-term growth and diversify the company’s offerings."
Discovery’s TV brands in the Nordic region include Discovery Channel, TLC, Animal Planet, Discovery Science, Investigation Discovery and Animal Planet.

Said Mark Hollinger, president and CEO of Discovery Networks International: “Henrik’s proven ability and knowledge of the market, along with the expertise and creativity of the entire team at SBS, will be a tremendous asset for the company as we continue to grow our networks and businesses in the Nordic region and strengthen Discovery’s leadership position around the world.”
Added Ravn: "I am confident that the combination of Discovery’s leading factual content, along with SBS’ mix of locally produced entertainment programs, sports and the best scripted series and movies from major studios, provides a well-rounded and complementary suite of viewing options for consumers across all demographics, as well as additional scale and reach for advertising and affiliate partners throughout the region.”
Other members of the SBS Discovery Media senior management team include Christian Kemp as CEO Denmark, Jonas Sjogren as CEO Sweden/Finland, Harald Stromme as CEO Norway and Eivind Landsverk as programming & content director. Jan Andreassen, the leader of Discovery’s Nordic business, will serve as a member of the integration team.


Twitter: @georgszalai