Disney CEO Bob Iger has a lot on his plate these days. Since returning to the job he had left behind just two years ago for his handpicked successor, Bob Chapek, he’s weathered a downturn in his flagship Marvel and Lucasfilm divisions, massive losses from the Disney+ streaming initiative, and a historic double strike in Hollywood shutting down production. And that’s before you get to old-school linear television, where he just suffered through a bruising negotiation with Charter Communications and saw the unthinkable happen: a blackout for tens of millions of customers of ABC and ESPN (the deal wrapped up just in time for the inaugural Monday Night Football broadcast).
In recent months, he’s mused aloud to CNBC in July that linear TV “may not be core” to the company’s future. Now another shoe may be dropping, as Bloomberg reports that Iger has fielded a $10 billion offer for ABC, one of the traditional “Big Three” networks, and the bidder is none other than Byron Allen, one of America’s most prominent Black businessmen and a bona fide media mogul. It’s early in any potential sale process, but Allen’s ownership of ABC would cap a remarkable career of media M&A.
Earlier this week, Bloomberg separately reported that Disney had held talks with Nexstar Media Group, which owns roughly 200 local television stations around the country, about selling ABC and its local affiliates. Disney issued a public statement confirming that it was considering options but had made “no decision” regarding the future of ABC or other assets.
The current offer wouldn’t be Allen’s first dealing with Disney. In 2019, he became an equity-holding partner in a company formed when Sinclair Broadcast Group scooped up some 20 regional sports networks from Disney for $10.6 billion.
Allen’s offer was reportedly for a package of eight local stations, cable channels National Geographic and FX, and the crown jewel: ABC. Allen Media Group, of which Allen is chair and CEO, valued the total earnings of those channels at $1.25 billion over the last 12 months, a person familiar with the deal told Bloomberg. The final deal price could change based on whether their actual earnings turn out higher or lower than the forecasted $1.25 billion, Bloomberg further reported.
Here’s a look at how Allen ascended from a start in stand-up comedy to a perch as a media kingpin poised to take over one of America’s most important TV properties.
A prolific dealmaker
Pulling off this deal would cap a raft of recent acquisitions for Allen, who may have seemed an unlikely mogul when he debuted on Johnny Carson’s Tonight Show in 1979 as an 18-year-old comic—the youngest in the program’s history.
Allen transitioned from talent to executive in the early ’90s, eventually launching Allen Media Group (then called Entertainment Studios) in 1993. The first show he produced, Entertainers with Byron Allen, in which he interviewed celebrities at various press junkets, laid the groundwork for what evolved into a unique syndication model. Rather than charge networks a fee to license the show, he would offer it for free and then take a cut of the advertising revenue on the back end.
Allen spent the next decade or so buying up local television stations and managing syndicated programming. An interview he gave to PBS Newshour in 2022 suggested that he relied on reinvesting whatever profits his syndication would generate because, he told the public broadcaster, no bank would give him a loan in the first 15 years of his company and he regularly struggled to organize financing.
It’s been a very different story in recent years, as Byron has gone on a debt-fueled acquisition spree, branching out into local news, digital media, and a variety of different programming to build out his syndication and production businesses. Detractors, including credit ratings firm Moody’s, have been wary of Allen’s habit of financing his M&A deals with credit. “Management’s financial policy allows for high leverage that is currently above our tolerance,” Moody’s wrote back in 2018, according to Bloomberg.
Nonetheless, he has remained a prolific dealmaker. Perhaps his most high-profile acquisition was in 2018 when the Allen Media Group unit Entertainment Studios acquired the Weather Channel for $300 million. Another occurred in 2016, when Allen’s company acquired the popular media brand TheGrio, which serves a primarily Black audience. Keeping with his emphasis on Black-owned media companies, Allen in 2022 purchased the Black News Channel, which he promptly renamed TheGrio Television Network.
In the last few years, Allen has been on a mission to turn Allen Media Group into one of the country’s biggest owners of local television stations. Between 2019 and 2020, he spent roughly $500 million on two smaller holding station owners Bayou Broadcasting and USA television, according to the company website. And this spring Allen rekindled his long-standing interest in acquiring Tegna, which owns about 70 local TV channels.
However, his dream acquisition has long been BET, which he says should be Black-owned. BET is currently owned by Paramount Global. It was created by another Black media mogul, the billionaire Robert Thompson, who also owned the Charlotte Bobcats NBA franchise before selling it to legendary player and North Carolina native Michael Jordan in 2010.
Allen’s penchant for lawsuits
Allen has also made headlines for a couple of high-profile lawsuits against Fortune 500 companies in which he alleged racial discrimination.
In 2019, he sued McDonald’s for racial discrimination, claiming the company had only spent 0.3% of its advertising budget at Black-owned media companies. He re-upped his alleged grievances against McDonald’s in June, when he filed an additional $100 million lawsuit alleging the company had “lied” when it promised to increase its media spend at Black-owned outlets from 2% to 5% by 2024.
In 2015 and 2016, Allen sued Comcast and Charter Communications for $20 billion and $10 billion respectively over claims that the two companies refused to carry cable channels owned by his company Entertainment Studios because he was Black. (Charter Communication was recently engaged in a dispute with Disney over a renewal of their distribution agreement.) The case relied on a part of the Civil Rights Act of 1866, which allowed Black Americans to enter into contracts in the same way white people could. Allen contended that his race was one of the factors for why both companies refused to pick up channels like Pets.TV and Cars.TV, pointing to the fact that competitors Dish Network and DirecTV did carry them. The lawsuit against Comcast made it all the way to the Supreme Court, which unanimously ruled to send the case back to the 9th U.S. Circuit Court of Appeals.
“This is a very bad day for our country,” Allen told Yahoo Finance at the time. “Unfortunately, the Supreme Court has rendered a ruling that is harmful to the civil rights of millions of Americans.”
In June 2020, Comcast and Allen settled out of court for an undisclosed sum and reached a carriage agreement for Entertainment Studios’ various cable channels. A few months later, in February 2021, he would settle with Charter as well.
To hear Allen tell it, all his previous moves and deals were preparation for Allen Media Group’s current moment. “We haven’t even begun,” he said in the same PBS interview. “The first 20, 30 years were the hardest; that was laying down the foundation. Now we’ve laid down the foundation—watch the skyscraper go up.”
This story was originally featured on Fortune.com
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