By Thomas Heath and Howard Schneider
Washington Post Staff Writers
Wednesday, June 20, 2007
Washington Redskins owner Daniel Snyder yesterday purchased the company behind the Golden Globe Awards show and Dick Clark's "American Bandstand," adding to Snyder's entertainment portfolio that includes movies, amusement parks and a 1950s-themed hamburger chain.
In the past two years, Snyder has struck a deal to produce movies with Tom Cruise. He has bought the Johnny Rockets restaurant chain, which features a waitstaff that dances and sings oldies. He has assembled a group of five radio stations to transmit his team's football games. And he continues to spend millions of dollars to recast Six Flags' troubled theme parks.
Snyder's Red Zone Capital, a private-equity firm, yesterday announced the purchase of Dick Clark Productions for $175 million from Mandalay Entertainment Group, a private company owned by Peter Guber, formerly studio chief of Columbia Pictures. Six Flags, a publicly traded company, will own 40 percent of the production company.
Along with the "Bandstand" library of television shows spanning three decades, Snyder gets the perennial "New Year's Rockin' Eve" broadcast from Times Square, the Golden Globe Awards show, the American Music Awards and the Academy of Country Music Awards.
Red Zone and Dick Clark Productions have hired Creative Artists Agency, a Hollywood talent firm, to help find ways to exploit and sell the company's properties. Six Flags chief executive Mark Shapiro said the Dick Clark properties, which include the popular reality television show "So You Think You Can Dance," provide a natural fit with the company's theme parks.
"This raises the consciousness of our brand and better positions us to speak directly to the American family," Shapiro said. "These are all shows that the entire family watches together. There is the opportunity to do special events like clinics, tours, auditions at the parks."
Shapiro, who declined to comment on Red Zone or any other of Snyder's holdings, said he envisions the 877 hour-long "American Bandstand" reruns being broadcast on plasma screens across Six Flags parks.
"We can use awards-show tickets, promotions and backstage passes to drive season-pass sales," he said. " 'Buy a Six Flags season pass and win a chance to go to the American Music Awards.' We are putting plasma screens in every crowded ride line and every crowded food line. And now people can watch our own content. Who's not going to watch the Rolling Stones on 'American Bandstand'?"
The Dick Clark acquisition fits into Red Zone's investments, as well as Snyder's personal holdings, in leisure industry assets. After making his fortune in marketing, he bought the Redskins and turned it into one of the most valuable franchises in professional sports. Snyder has since gone into the private-equity business with an eye toward Hollywood, as well as toward acquiring what he has termed "under-marketed" leisure properties.
So frequent have been his visits to the West Coast that fellow businessmen and associates of Snyder have been talking privately in the past few months about whether Snyder would buy a residence in Los Angeles.
Snyder, who will take over as chairman of Dick Clark Productions, declined to comment. In a press release, he said, "This was a rare opportunity to acquire a powerhouse portfolio and grow it in new directions."
Terry Bateman, former chief marketing officer for the Redskins, will be chief executive of Dick Clark Productions.
Clark, 77, is quoted in a Red Zone press release as saying the deal had his "full support," though there was no description of his prospective role with the company he founded in 1957 as the dapper host of "American Bandstand."
In addition to his television and movie interests, Snyder has established Red Zone Capital, a partnership that holds 12 percent of Six Flags' stock. Snyder became chairman of Six Flags after a proxy fight in 2005, when he forced out the old board, installed his own directors and picked Shapiro, a former top ESPN programming executive, to run the company.
Also in 2005, Snyder began cobbling together his own local radio network, known as Red Zebra Broadcasting, to air Redskins games. He bought five radio stations, including three in the Washington area and one each in Richmond and Hampton Roads. He hired local radio executive Bennett Zier to run Red Zebra, which featured a talk show with former Redskins running back John Riggins. The stations have been plagued by problems with spotty signals, and Zier quit earlier this year after 14 months on the job.
Snyder formed another partnership last July with a goal of raising $750 million to fund new business ventures. The private-equity partnership lists Snyder and Dwight C. Schar, chairman of NVR of Reston, one of the nation's biggest home builders, as partners. The partnership is based in Tysons Corner and concentrates on entertainment properties. The company had raised $126 million, according to a November filing with the Securities and Exchange Commission.
Last August, Snyder partnered with Shapiro and Schar, who owns 15 percent of the Redskins, on a two-year deal with Cruise's production company to pay $3 million to $10 million annually for development and overhead costs in exchange for the opportunity to finance film projects and to profit from any hit movies.
Working under a partnership called First and Goal, the group's investment will help cover operational costs while Cruise and his production partner, Paula Wagner, develop movie projects. Shapiro will oversee the investment. Snyder, Schar and Shapiro have the right to back out after two years or renew the deal long-term.
In February, a Red Zone fund bought the privately held Johnny Rockets restaurant chain for about $100 million.
Staff researcher Madonna Lebling contributed to this report.