Forget About Maker Studios, Relativity’s Now Talking to Fullscreen

/ May 1, 2014


Called it.

According to multiple reports and sources familiar with the situation, Relativity Media, after being spurned by Maker Studios, has held discussions with Fullscreen over a potential sale.

That’s as much as everyone seems to know for sure. Everything else is a bit unclear.

Per The Hollywood Reporter, one person claims Relativity’s base offer is for $350 million, with $400 million in additional earnouts. Another says the deal could be valued as high as a billion dollars. If you’re looking to compare: Maker Studios’ deal with Disney, which is in the process of being completed, is for $500 million with $450 million in additional earnouts.

According to people we’ve spoken to, Relativity’s offer to buy Fullscreen would have to be primarily in stock. Quite simply, the studio does not have the capital to purchase the YouTube giant in a deal that would not include a heavy share of its stock, these people have said.

A few weeks ago, Relativity offered Maker’s board an alternative to the Disney deal: $525 million in cash and stock, with the potential for an additional $500 million plus a $70 million “bonus pool” for select executives and Maker creators.

That would suggest that Relativity has at least some cash to play around with, and is heavily interested in buying a YouTube business. But industry chatter pegged that proposal, which came in at the last minute, as not being all that serious. It was more a move for people to start talking about the studio’s interest in the space.

One thing IS clear, multiple companies are circling Fullscreen, largely spurred on by Disney and Maker Studios.NBCUniversal is said to be another company eyeing Fullscreen, now the largest independent network on YouTube.

As reported by Recode yesterday, Fullscreen has hired Allen & Co. to advise on the offers.

The company, founded by former YouTube executive George Strompolos, who co-created YouTube’s partner program, currently reaches more than 360 million subscribers on YouTube. It most recently signed Grace Helbig, who’s closing in on 2 million subscribers for the second time in her YouTube career.

Relativity’s talks with Fullscreen was first reported by AdAge.

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