Media mogul Byron Allen has reaffirmed his willingness to pay Disney $10 billion for ABC and a package of other cable holdings, including National Geographic and FX, that would add considerable heft to his already sizable TV empire.
The outspoken founder of Allen Media Group had made an offer earlier this month for the Disney properties and revealed he had been wooing Disney CEO Bob Iger for years over his interest in the cable assets. Allen says the two first met when he was the host of reality television program Real People in the early 1980s and Iger was an up-and-coming ABC executive, and that the two even sent their children to the same school. “I’ve been on his case for years,” Allen said during an interview Wednesday at Vox’s Code Conference in Dana Point, Calif. “Like, ‘Come on, Bob—what are you doing, man, let go of those stations.’”
When Iger told CNBC in July that he was considering selling Disney’s cable channels, Allen picked up his courtship in earnest. “I immediately texted him and said, ‘Hey, I’m your man,’” Allen said.
However, Allen admitted that he’d have to wait patiently because Iger wasn’t ready to sell yet. Iger, according to Allen, was still in the process of determining the best way to separate ABC from Disney.
Allen Media Group’s acquisition spree over the last five years—$300 million for the Weather Channel and around $500 million for local television stations—has been primarily financed by debt. When asked by CNBC’s Julia Boorstin how he’d fund the $10 billion needed to meet Disney’s asking price, Allen was unwavering.
“The capital is not the problem,” Allen said. “The real commodity is certainty of close—approval of the deal.”
He went on to explain that his company was the best option for Disney because regulators wouldn’t block the deal as they might with other possible buyers. The government, Allen said, wouldn’t allow Big Tech firms, which are under scrutiny by both political parties, to make the acquisition and grow even bigger by branching out into legacy media. “A tech company can’t even buy a lemonade stand today,” Allen said. “And if they think they can go buy something of this scale, they’re ill advised.”
Recent lawsuits from Lina Khan’s Federal Trade Commission might provide some evidence to Allen’s point. The FTC, under the Biden administration, has been clear in its efforts to reduce the influence of major tech firms. Just this week the FTC filed a historic and long-anticipated lawsuit against Amazon, accusing it of being a monopoly. Alphabet is currently fighting its own antitrust lawsuit over accusations that its Google search engine unfairly stifled competition on its way to dominating the market for online search. And in July of last year the FTC sued to block Meta’s attempt to buy a virtual reality startup, accusing it of trying to buy rather than innovate its way into new markets. Nevertheless, in February, Meta won approval for the deal to go through.
Private equity and hedge funds would be equally unappealing buyers for regulators because of their poor handling of news organizations in the past, Allen says. “D.C. is not—how should I say it—they’re not impressed with the way private equity and hedge funds handled newspapers and accelerated their demise,” Allen said. It’s a topic that Allen says he is passionate about, hence his Allen Media Group’s ownership of 36 local news stations. Private equity firms or hedge funds could bid but Allen believes they’d need a partner like him to operate the networks to get the deal approved. Any other big media companies would be barred from making the deal because of a media ownership law, which bars a company from controlling more than 39% of the market nationwide.
Allen, in his eyes, is something like the last man standing. “I’m the prettiest girl at the dance, let’s just be honest,” he said.
Allen Media Group declined to comment.
“I’m building the world’s biggest media company”
Allen, who started his media company at his dining room table after a stint as a comedian and talk show host, has become increasingly open about his ambitions. “I’m building the world’s biggest media company,” he told Boorstin when asked about his five-year plan. Buying one of the big four networks and one of the most trusted sources of news in the country would no doubt be a considerable step toward achieving the influence he seems to desire, if not necessarily the scale.
His biggest move so far was when he acquired the Weather Channel in 2018. Even then he bought a stodgy linear TV asset and identified a previously underappreciated value. After the acquisition, he pivoted its content strategy to focus on climate change, after the network had previously avoided doing so for fear of alienating climate deniers—including former President Donald Trump.
“We’re going to tell the American people the truth,” Allen said. “We’re going to educate them on what [climate change] means and how it’s impacting us and how we’re going to protect and save their lives and their loved ones.”
Allen’s white whale has long been buying BET, which he said should return to being Black-owned (Allen is Black). He reportedly offered BET’s parent company Paramount $3.6 billion for the network, only to have his bid rejected. “I want BET not just for economic reasons,” Allen said. “I want BET for social reasons.”
