TPG, the private equity investor that bought RCN and Grande Communications earlier this year, is branching out into content with a $450 million minority investment in Vice Media that values the youth-oriented programmer at $5.7 billion.
TPG joins a heady group of minority investors in Vice, including The Walt Disney Co., 21st Century Fox, A+E Networks, advertising giant WPP and Silicon Valley investor Technology Crossover Ventures.
TPG owns other media assets – its portfolio includes talent agency CAA, subscription online music pioneer Spotify, Spanish language broadcaster Univision and film studio STX Entertainment. Last August, TPG purchased overbuilder RCN and Grande Communications in a deal valued at $2.25 billion. In May it agreed to buy Wave Broadband for $2.36 billion.
The Vice Media investment is for an undisclosed minority stake and will help the media company launch and finance Vice Studios to produce scripted multi-screen programming to complement its library of news, documentary and reality programming. The media brand also hopes to use the money to build out its next generation of products and revenue streams, including OTT and direct-to-consumer offerings.
In a statement, Vice founder and CEO Shane Smith pointed to Facebook and Google taking an increasingly larger chunk of the advertising pie, and the emergence of skinny bundles, OTT and DTC offering disrupting the status quo as evidence that networks need to be “nimble, smart and fast moving.”
The TPG investment will help Vice build out its video library and expand its offerings in news, food, music, fashion, and feature films, to name a few.
“Building out this wide ranging and rich library of gold standard content will be an essential component of our future Direct to Consumer tech stacks and our innovations in transactional relationships - all of which represent the future of media,” Smith said in a statement.
Vice, which includes 13 owned and operated digital channels, the Viceland cable network, mobile partnerships, feature films, a print magazine, a branded content studio, and a documentary series (Vice) and a daily news show (Vice News) on HBO, will continue to be independently controlled and operated.