NEW YORK (Reuters) - CBS Corp and GE’s NBC Universal plan to bid for the Weather Channel in the second round, with bids expected to range between $3.5 billion and $4 billion, people familiar with the matter said on Tuesday.
Privately held Landmark Communications, which has put the channel up for sale along with other businesses, had originally sought $5 billion for the asset, sources have said. The sources asked not to be identified because the talks are confidential.
The bids for the channel, due May 8 from less than five strategic bidders, come after Landmark earlier this year hired JP Morgan and Lehman Brothers to study its options. The first round of bids was in March.
Landmark could not be immediately reached for comment. Both CBS and NBC declined comment.
But CBS Chief Executive Les Moonves, when asked about his interest in cable deals, including the weather channel, said: “We look at everything. There are lots of media deals out there, when they become presented, we look at them.
“There are no plans to announce anything major, but we do look at everything,” Moonves said, speaking on the company’s earnings conference call.
While considered a prized asset, auction of the Weather Channel has failed to attract private equity as the credit crunch has restricted financing for major leveraged buyouts, sources have said.
The Weather Channel appeals to media companies looking to enter cable or expand their holdings, since the network’s time-sensitive broadcasts and programming about hot-button issues on the environment have proven to be attractive to audiences and advertisers, according to industry experts.
The Weather Channel produces continuous, 24-hour national, regional and local weather-related programs and is received by more than 96 million U.S. households. It can be seen in more than 97 percent of all cable TV homes nationwide.
The channel’s accompanying Web site attracts about 35 million unique users each month, Landmark said. That puts it among the Web’s 20 most popular sites, and the top destination for online weather, news and information.
Landmark, based in Norfolk, Virginia, declined to comment on the auction process.
Landmark’s interest in selling The Weather Channel comes amid broader shifts in the cable TV landscape. Sundance Channel, the joint venture between CBS, NBC Universal and Sundance founder Robert Redford, is for sale.
Discovery Communications, which includes, the Discovery Channel, Science Channel and Animal Planet networks, is expected to become a publicly traded company in the second quarter.
In addition, IAC/InterActiveCorp is spinning off its HSN shopping network as part of a larger restructuring, and E.W. Scripps Co plans to split itself into two publicly traded companies, one that will center on its cable channels and another that will include its newspapers and broadcast TV stations.
Reporting by Jui Chakravorty; Additional reporting by Paul Thomasch; Editing by Brian Moss
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