The American channel The CW has been sold. Nextstar Media Group, the television network that already broadcasts The CW’s content in the United States, is taking over 75% of the company. Paramount Global and Warner Bros. Discovery, the current owners of The CW, will remain in the partnership, each retaining 12.5% of the network.
“Our acquisition of The CW is strategically and operationally compelling as it will allow us to leverage our operational experience to improve network performance by managing this powerful national platform,” said Perry Sook, Nexstar President and CEO, on Monday. (8/15).
Financial terms of the deal were not disclosed, but sources familiar with the negotiations say Nexstar didn’t have to pay anything for the purchase. Instead, the company will aggregate the majority of the over $ 100 million debt accrued in losses from the issuer’s operations, which were on the books of Paramount and WBD.
Home to the Arrowverse series “Riverdale”, “Legacies”, “Walker” and many other fantasy attractions for young people, The CW opened in 2006 as a result of the merger of the former UPN and Warner US channels. Many are betting the experience wouldn’t last, but while it never became profitable in the traditional way, the joint venture proved to be a good deal for both CBS and Warner studios (the C and W of the channel name). .
The CW has never been profitable as a television channel, but it has been a great deal for CBS and Warner, as it started earning from the synergy, buying only series produced by the two companies. Furthermore, this content was later traded by his studios for the international market and streaming. Netflix alone paid $ 1 billion for The CW’s content viewing rights in 2018.
However, this model has suffered shocks in recent years, following internal changes in the proprietary companies. Warner was disastrously acquired by AT&T, which proceeded to dismantle the company, dissolving or selling part of its capital only to “resell” it in an incredible merger with Discovery. CBS, on the other hand, survived a sex scandal by its boss, Les Mooves, to merge with Viacom.
Last year, the two groups began prioritizing the expansion of their streaming services, HBO Max and Paramount +, over all other projects. So they broke the billionaire deal with Netflix, blocking the flow of money to the channel. It was a fatal blow. Realizing the flaw in this plan, they began courting the idea of selling the station.
The new owners recognize the work to be done.
“It is no secret that The CW is not profitable,” said Lee Ann Gliha, CFO of Nexstar, who added: “No other channel operates with continuous losses.” Nextstar’s goal is to reverse this scenario and make the issuer profitable by 2025.
For this reason, the sale will affect the number of attractions on the CW. Cancellations that began in April reflect this plan. Series like “Batwoman”, “Legends of Tomorrow”, “Charmed”, “Dynasty”, “Legacies” are just some of those closed for negotiation.
Until the sale is complete, which should take a few months, The CW will continue with only some of its most established series, such as “The Flash”, “Riverdale”, “Superman & Lois” and “Walker”, with the intention of closing. “The Flash” and “Riverdale” next season.
Recently, the channel will launch just three attractions this fall: “Gotham Knights”, a new DC universe production, “The Winchesters”, a prologue to “Supernatural”, and “Independence”, a series derived from “Walker” .
According to Carter, Paramount and Warner must continue to produce content for The CW, but that deal is only valid until 2023. Thereafter, Nexstar has the option to maintain the creative partnership, but not the obligation to do so.
In any case, the investment in series will be much lower than the current one.
“We plan to invest a low 9-figure amount over this 3-year period as we implement our plan,” explained Gliha. “We see this as an indicator of a purchase price – or an investment made over time – rather than an obstacle to ongoing cash flow. You know us. We are focused on profit and cash flow and hope this asset will reach profitability “.
But investments are expected to increase in the future. “Then, over time, we will take a different approach to our programming strategy at The CW and leverage our expertise by spending approximately $ 2 billion annually on programming, viewer attraction and monetization, and the transition of NewsNation. our national cable news network, from WGN, while maintaining a strict focus on cash flow, “said Tom Carter, CEO of Nextstar.
George Cheeks, President and CEO of CBS at Paramount, added, “This new ownership structure allows us to partner with Nexstar and Warner Bros. Discovery in the next chapter of The CW, as we redistribute capital to other Paramount content platforms.”
Channing Dungey, president of Warner Bros. Television Group, was delighted with the sale. “We look forward to continuing to collaborate on our shared series and future projects under Nextstar’s leadership,” said the executive.
Source: Terra
Camila Luna is a writer at Gossipify, where she covers the latest movies and television series. With a passion for all things entertainment, Camila brings her unique perspective to her writing and offers readers an inside look at the industry. Camila is a graduate from the University of California, Los Angeles (UCLA) with a degree in English and is also a avid movie watcher.
