Discovery Deal Paves Way for Firm to Go Public
Thursday, June 5, 2008
Silver Spring's Discovery Communications can now proceed with its plan to become a publicly traded company, following an agreement yesterday by its parent company and a major stakeholder, the company reported.
The announcement came the same day that Discovery launched its Planet Green multimedia effort, the first new channel launched under chief executive David Zaslav, who took over Discovery in January 2007. Discovery switched its Discovery Home cable channel to Planet Green last night, with programming aimed at eco-living. Planet Green is complemented by a new Web site that folds into TreeHugger.com, which Discovery bought last year.
Discovery, home to popular television shows such as "MythBusters" and "Man vs. Wild," has been a privately held company since John S. Hendricks founded it in 1982.
Discovery's parent, Discovery Holding, is controlled by billionaire John C. Malone, chairman of Liberty Media. The other major shareholder is Advance/Newhouse Communications, owner of the New Yorker and other magazines.
Liberty and Advance said yesterday that they will combine their stakes in Discovery, allowing it to go public as a stand-alone company. The move will give Discovery access to public money but place it under Wall Street's quarterly scrutiny for the first time.
Discovery Communication's first-quarter revenue rose 12 percent compared with 2007, the company reported last month.
Zaslav will remain chief executive and Hendricks will be chairman in the new publicly traded Discovery.
Shares of Discovery Holding closed up 48 cents at $26.43 yesterday.
Another former shareholder, Cox Communications, sold its 25 percent stake back to Discovery last year, helping Discovery begin to simplify its ownership structure.
Discovery has more than 100 channels in 173 nations, which it says reach a worldwide audience of 1.5 billion.