Providence, 3i team up for Crown buy

Crown Media Holdings, owner and operator of the Hallmark Channel, is selling its international business to a group of investors comprising Providence Equity Partners, 3i and UK television executive David Elstein.

The US$242m sale includes international versions of the Hallmark Channel distributed outside the US to 152 countries and about 60m subscribers, as well as rights to more than 580 titles in the Crown Media Library. Through its subsidiary, Crown Media Distribution, Crown distributes titles from its collection of movies, mini-series and films for broadcast in a variety of television media.

Elstein, the former chief executive of the UK’s Channel 5, will be chairman of the new company. He has 40 years experience in media production and management and is currently chairman of the British Screen Advisory Council and a non-executive director of NTL and Kingsbridge Capital. “We are confident that the investor group will capitalise on its global media expertise to continue to expand this international business,” said David Evans,

president and chief executive of Crown Media.

Providence Equity Partners, which has US$9bn in funds under management, specialises in equity investments in communications and media companies. Current investments include Metro-Goldwyn-Mayer, eircom, Casema, Kabel Deutschland and Bresnan Broadband Holdings.

3i has also been active in the media-publishing sector. Recent transactions include the €1bn refinancing of YBR, the classified phone directories group, and the IPO of Pinewood/Shepperton Studios, a TV and film production company.

Proceeds from the transaction will be used by Crown Media to reduce outstanding bank debt, for the repayment of certain inter-company receivables and to meet other liabilities.

Investors in Crown Media Holdings include Hallmark Entertainment Holdings, a subsidiary of Hallmark Cards; Liberty Media; and JPMorgan Partners.