KEY ISSUES

Scripps Networks Interactive is not a recognizable brand compared to the channels they own. As a result, their stock underperforms in comparison to similar companies, reported Seeking Alpha. However, this issue may change in the near future due to the merger with Discovery Communications.

 

Discovery Communications, Inc. announced that it reached an agreement to acquire Scripps Networks in July, 2017 for $14.6 billion. On February 28, 2018, The U.S. Department of Justice gave Discovery Communications clearance to acquire Scripps.

 

Scripps announced that they have set a deadline for shareholders to hold an election to determine what form of payment they would like to receive following the merger, according to News Bites US Markets. The European Commission also cleared Discovery Communications’ “proposed purchase of Scripps Network Interactive, subject to certain conditions in Poland,” reported CED.

 

On March,6, the Discovery Communications officially completed its acquisition of Scripps Networks Interactive, according to a press report. The combined company will be known as Discovery, Inc.  Scripps shareholders will receive approximately $90 per share, specifically $65.82 per share in cash and 1.0584 share in Series C Common shares of Discovery stock.

 

Kenneth W. Lowe, former Chairman, President and CEO of Scripps will join Discovery’s board of directors, according to Discovery’s website; Jon Steinlauf, former President of National Ad Sales and Marketing, will lead the combined Ad Sales, Consumer Products and Licensing, and revenue-generating operations; Kathleen Finch, former Chief Programming, Content and Brand officer, will oversee 12 lifestyle channels, including HGTV, TLC, Food Network, Travel Channel, and DIY Network. Other Scripps Networks executives will participate in the integration process and help conduct a smooth transition.

 

The rebranding of both Scripps and Discovery may solve their issue of recognition. The combined company may also have any increased odds at gaining new viewership, mainly men and the younger audience. They now reach 220 countries and territories.