Viacom CEO Philippe Dauman squashed any speculation that the media giant would be among the bidders for The Weather Channel, telling the audience at an investor conference in New York last week that Viacom will concentrate on growing its existing properties.
“I think we have a lot of opportunities to grow the networks we have and look at opportunities where others are not looking,” Dauman said at the Sanford Bernstein Strategic Decisions Conference Wednesday. “We do look at the cable networks. We’re not interested in The Weather Channel. Scripps is not yet available for sale; we’ll look at it like everyone else. I have a feeling that everyone will be looking at that property. We’re not going to chase it.”
The Weather Channel went on the block in January and final bids were expected last week. According to people familiar with the auction, Time Warner and NBC Universal were expected to be the leading bidders for the network, which is said to have attracted prices in the $3.5 billion to $4 billion range.
A report in the Financial Times last week said NBC Universal was putting the final touches on a financing package for the deal with partners Blackstone Group and Bain Capital for between $3 billion and $4 billion. While the paper said that NBC was the lead bidder, it could be trumped by a higher offer from Time Warner.
E.W. Scripps, which includes Food Network, HGTV, DIY and Fine Living, is slated to split into two separate companies — E.W. Scripps and Scripps Networks Interactive — by the end of the second quarter.
“The era of big acquisitions is over,” Dauman said. “We have a lot of opportunity in the long run to grow our business organically and we have runway to grow our brands in many different directions.” He added that Viacom had looked at the Oxygen cable network when it was for sale — it was purchased by NBC Universal in October for $925 million — but passed because the price was too high.
“We looked at Oxygen, we passed on that fairly quickly,” Dauman said. “While we look at things, I don’t expect to see us make any major acquisitions for the foreseeable future.”
While Dauman said Viacom is optimistic about the upfront market, he warned that advertising-sales growth for the media giant will likely be softer in the second quarter, mainly because of the struggling economy. Ad-sales growth, about 7% in the first quarter, will be between 3% and 4% in the second quarter, or about flat with the same period in 2007.
Several factors contributed to the flat advertising growth, said Dauman, including the economic climate and softness in such isolated segments as the automotive industry.
“We feel [we have] very good momentum as we go forward, particularly in the upfront,” Dauman said.