Chernin and AT&T Close to Buying Controlling Stake in Fullscreen (Report)

/ Jul 23, 2014

fullscreenlogo

The Chernin Group and AT&T through their joint venture called Otter Media are nearing a deal to buy a majority stake in YouTube multi-channel giant Fullscreen.

As first reported by Recode, the deal would value Fullscreen between $200 million and $300 million. For context, Fullscreen’s biggest competitor in the YouTube space, Maker Studios, sold to Disney for $500 million, with $450 million in additional payouts depending on the company’s performance. (That said, it’s important to note that Otter Media wouldn’t buy Fullscreen outright, which is what Disney did with Maker.)

If the deal is completed, this would keep Fullscreen in the Chernin family. The Chernin Group led a $30 million Series A round in the MCN over a year ago.

More recently, The Chernin Group partnered with AT&T to launch Otter Media, a joint venture focused on investing in and acquiring over-the-top video startups. The firm has $500 million behind it and recently made its first acquisition, for Demand Media’s Creativebug, which distributes DIY arts and crafts videos.

If you’re looking for a reason for why Otter Media would want a controlling stake in Fullscreen, it’s right there: over-the-top. Fullscreen is developing an owned-and-operated video platform that would bring premium content from its network of talent as well as from other creators. This content, which the company has yet to comment on, would look to super-serve millennials.

As we said back then, a marriage between The Chernin Group and Fullscreen make a lot of sense. Fullscreen has been developing its own over-the-top video platform at the same time its investor The Chernin Group has expressed interest in owning such businesses made the two a perfect match.

According to Recode, if the deal is finalized, Fullscreen CEO George Strompolos would continue to run the company.

Other investors in Fullscreen include Comcast Ventures and WPP Digital.

More to come from this, I’m sure.

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