Top YouTube multichannel network Fullscreen is officially being acquired by Otter Media, the joint venture between AT&T (NYSE: T) and the Chernin Group. The deal could be worth between $200 million and $300 million, Re/code reported, although the exact sale price wasn't revealed.
Under terms of the agreement, Otter Media is buying a majority stake in the MCN, which routinely places among the top five online video services with monthly views in the 4 billion range. The transaction is expected to close next month pending regulatory approval.
Speculation about a deal between Fullscreen and Otter Media began in July, when Re/code reported the channel was in talks with AT&T and Chernin.
The reported $200-$300 million price tag is a smaller payout than the landmark Disney purchase of Maker Studios last spring. Disney bought that top MCN for around $500 million, and the deal ultimately could be worth $950 million.
Fullscreen began exploring the possibility of being acquired a few months ago, revealing in May that it had hired Allen & Co. to review its options. Rumored negotiations with Time Warner apparently came to naught, with the media company reportedly balking at the selling price.
However, Otter Media is likely betting on the potential success of Fullscreen outside Google (NASDAQ: GOOG)-owned YouTube's environment. George Strompolos, CEO of Fullscreen, has reportedly been planning to launch a paid version of the network featuring its top online stars, Re/code reported.
Strompolos, in a prepared statement, called the acquisition a "huge win" for Fullscreen and its cadre of creators. "With AT&T as a strategic investor in Otter Media, we are well positioned to redefine youth media in today's digital-first world," he added.
Fullscreen's management team will remain intact, continuing in their present roles, according to the press release.
For more:
- Re/code has this story
- see the press release
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