View Full Version : Disney Out of Muppetville
10-08-2002, 05:39 PM
From Yahoo.com News:NEW YORK, Oct 8 (Reuters) - Billionaire investor Haim Saban is in talks to buy Muppet-maker Jim Henson Co., at a steep discount to what Germany's EM.TV & Merchandising AG paid for it, people close to the situation said on Tuesday.
The two sides are still haggling over the price, but it is broadly in the vicinity of about $100 million, these people added. EM.TV paid $680 million for Henson in February 2000.
There may be other suitors for the makers of Miss Piggy, Cookie Monster and Big Bird, the sources said, but the EM.TV unit has been on the block for more than a year.
Representatives for Munich-based EM.TV and Saban declined to comment.
Saban, who made his fortune with children's figures the Mighty Morphin Power Rangers, has savvy bargaining power on his side. Nancy Schultz, who served as Henson's chief financial officer for a short time, and who also advised Henson when she was with PricewaterhouseCoopers, now works for Saban Capital Group Inc.
Jim Henson produces movies, such as "Muppets in Space," and its world-famous creature shop makes well-known puppets and creates special effects. It won an Oscar for the special effects in the film "Babe."
When the company's namesake, the beloved Jim Henson, died suddenly 12 years ago, Disney pulled out of a deal to buy the company, believing Henson embodied the empire he founded in 1958. Henson's son, Brian, ran the business until he and the family sold it to EM.TV.
EM.TV, which has been trying to raise money by unloading non-core assets, last year sold Henson's stake in Crown Media Holdings for about $100 million. Sesame Workshop also bought the Sesame Street Muppets characters from Henson last year.
Disney and Viacom both were interested in buying Henson over the past year, but discussions with both fell apart, according to media reports.
Saban, who is also bidding for insolvent German media group KirchMedia, made about $1.5 billion last year when he and partner News Corp. sold cable network Fox Family Worldwide to Disney for $3 billion.
10-08-2002, 06:20 PM
So let me see if I've got the chronology right on this.
Disney (The Big ME) decides to play hardball (jerk around a former mentor) with Fox (Barry Diller) and pulls Disney cartoons from Fox.
Fox looks around for something to put on and Saban (Haim Saban) sells them a show he had picked up for peanuts in Japan and hadn't been able to sell till then. But not being your average 'cartoon schlepper' Mr. Saban makes them an offer they can't refuse that gives him a big piece of the action of a new cable channel they are starting instead of purely cashing in.
A couple of years go by and Haim wants the cash so he pushes the button on the contract that forces Fox to buy him out of the cable channel - but Fox (Rupert Murdoch) decides to see if there is anybody out there with money to burn - et' voila' Disney (The Big ME) coughs up a $5B furball to convert Fox Family into ABC 2 - 'The Sequel' and hands a $1.5B check to Haim and wishes him well.
Haim takes the interest from the $1.5B and buys the Jim Henson Co. with it.
Future guesstimate based on previous history:
Mr. Saban sells Jim Henson Co. to Disney in exchange for ABC 2...
10-08-2002, 07:24 PM
Thanks for the summary, bstanley.
Disney forks over $5.2 billion for a cable channel to "re-purpose" ABC shows, but, SURPRISE, ABC has precious few shows worthy of re-purposing. Not only that, but it turns out Disney could have obtained the channel for less...
However, Disney won't cough up somewhere in the neighboorhood of $100 million for the Muppet franchise, which is a near perfect fit with Disney's family entertainment content. (Side note - This becomes even more interesting when one considers that Disney may lose the rights to both Pooh, and the early images of Mickey within the next year or two...)
If Eisner was going to insist on taking Fox Family off of Murdoch's hands, he could have at least got it at a half-way decent price, and then purchased the Muppets with some of the saved money. Then, he'd at least have something that could be aired on ABC 2.
10-08-2002, 07:29 PM
If Eisner was going to insist on taking Fox Family off of Murdoch's hands, he could have at least got it at a half-way decent price, and then purchased the Muppets with some of the saved money. Then, he'd at least have something that could be aired on ABC 2.Told you he was - - - INEPT!!!
10-08-2002, 08:01 PM
Can't think of a better word to describe this series of events. Though I can think of a few expletives that could be added...
I should clarify my "side-note"... I should've said Disney could lose the EXCLUSIVE rights to the early Mickey images. Pooh, however, could be taken from them completely.
Sure would be nice to have Kermit to soften that potential blow...
10-08-2002, 09:31 PM
Just to add to the pile - Disney is now buying 'Monk' from USA Net in order to prop up the schedule at ABC, which doesn't have any shows to repurpose to ABC Family ('Life with Bonnie' just imploded today and will be cancelled within two months).
And since there are no ABC programs to repurpose on ABC Family, the cable channel is now buying programs to fill in the spots. They've already signed on deal with Warner Brothers to rebroadcast '7th Heaven' and are rumored to be working on deals for 'Smallville' and a few other WB series. And Disney is now paying huge bucks to HBO (part of Warner Brothers) to develop a new show or rebroadcast editted re-runs of HBO series.
It's amazing what Eisner has acheived - two television networks with nothing to show and a studio that can't even sell programs to networks it owns!
Inept doesn't even begin to start.
10-08-2002, 10:28 PM
who says you have to be smart to get rich?? Just be in the right place at the right time. (only it was the wrong time for Disney)
10-08-2002, 10:40 PM
At the rate Disney is going with their Disney "lite" channel, they might as well bring back shows like Scariest Places on Earth which Fox did fairly well with. At least that one was original and not a bunch of reruns from Warner Brothers. :rolleyes:
10-09-2002, 01:45 AM
You know Voice you make it sound like it is unheard of for a network to purchase shows from another network. This is a very common practice if I am not mistaken.
10-09-2002, 08:50 AM
Isn't he referring to Cou$in Michael's comments after the purchase that they would have 'synergy' among the divisions...in other words, ABC would become a prime time outlet for the Touchstone programming.
This sort of reminds me of when BK & McD were fighting...the group that owned KFC, Taco bell, and Pizza Hut were all owned by the group that owned PepsiCo. But BK and Pepsico had a long standing relationship (remember when you could get Mt Dew at BK?)
Then someone at McD allegedly told someone at BK (or maybe they just figured it out themselves) that everytime they pay for Pepsi products in their outlets, they are actually helping their competition build more Taco Bell's right next to the existing BK. And BK switched in a hurry.
By ensuring that he had a steady place to put programs, I think, Cou$in Michael forgot that the 'whispers' would start...and might hurt the bubble or marginal shows. Whispers like "if you put that Buena Vista or Touchstone or Wind Dancer program on your network, you are just giving money to the ABC family---to produce more or better shows to go up against your Wednesday night line-up."
Just a thought.
10-09-2002, 10:26 AM
Originally posted by Another Voice
('Life with Bonnie' just imploded today and will be cancelled within two months).
Wait a minute... I read that this show was given a full season order.
10-09-2002, 01:45 PM
Scoop, you are correct. That's why I was very careful to say early images of Mickey. Its my understanding (though if I'm wrong, I'm sure somebody will correct me) that only the CURRENT image of Mickey is considered a corporate trademark. Several articles have specifically mentioned this. Disney is in no danger of losing the exclusive rights to the current Mickey, even when 75 or 95 years come.
But I believe they do not have the same protection for earlier images of Mickey and the other characters, and those are still pretty recognizable images.
True, it all depends on what the Supreme Court rules, but the fact that they are hearing the case means contingency plans should be made ("work for the best, plan for the worst...")
Losing all rights to Pooh would be a much bigger blow. Again, its in the hands of the Justice system...
My point on this was that characters with the popularity and lasting appeal of the Muppets don't come along every day.
IF Pooh is lost, there will be a HUGE void, and there likely won't be any characters with the fit and appeal of Kermit and Co. available at that time.
Purchasing them now will be much cheaper than purchasing them later...
And even if Pooh is not lost, the Muppets are still a valuable asset that can provide legitimate content for Disney in film, TV, and the Parks.
Of course, if Disney could actually CREATE some characters with the lasting appeal of the Muppets, they wouldn't have this problem, but admittedly that's not a simple task, even if there was a management team focused on creativity and content.
10-09-2002, 01:50 PM
I MISS JIM HENSON!
10-09-2002, 02:54 PM
Apparantly Jim Hill has heared the same things from his sources. Disney seems to be out of the running for JHC. Here's a link to his article:
10-10-2002, 11:13 AM
I miss Jim Henson too. I want more Fraggles, and bring back the Muppet Show! I still love to watch the reruns.
You would think Disney would scoop up the Muppets in an instant.
10-10-2002, 04:48 PM
Just to add insult to injury, it appears that, while Saban isn't the only suitor for the Muppets Saban and Evercore are poised to sign a non-binding letter of intent with EM.TV soon, and are the front-runners, sources said.
Saban started his investment group after he and partner News Corp. sold Fox Family Worldwide to Disney for $3 billion last year.
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