What's Next: Goldman Steals an M&A Rainmaker: Goldman Sachs has poached one of the top dealmakers in tech, media and telecom from JPMorgan, signaling that Lloyd Blankfein and David Solomon are still bullish about the future of media mergers.
Kurt Simon, the global M&A chair at JPMorgan, advised Randall Stephenson on his $85.4 billion takeover of Time Warner and has been advising Bob Iger on the $71.3 billion acquisition of 21st Century Fox's entertainment assets. He also has also advised on deals involving Broadcom, Dell, Nextel and Softbank.
At Goldman, Simon will serve as vice chairman of investment banking and co-chairman of the technology, media and telecommunications group. His move was first reported by WSJ's Liz Hoffman and confirmed by a source familiar with his plans.
The Big Picture: Hoffman notes that Goldman "has hired 16 people firmwide at the elite rank of partner in the past year, about half of them in its investment-banking division," and says "the hiring push amounts to a bet—a potentially expensive one—that the merger and capital-raising boom will continue." | | | PACIFIC
The Agenda Good Morning. Happy Friday.
The M&A Summer isn't over. Shari Redstone may yet merge CBS and Viacom. John Legere is still pursuing Sprint-T-Mobile, and Bob Iger and Rupert Murdoch have six weeks left to best Brian Roberts' offer for Sky.
Meanwhile, Tribune Media is back in play ... | | New Fox, New Prey
Will Murdochs buy Tribune?
Tribune Media is for sale again now that it has terminated its $3.9 billion deal with Sinclair.
Will Fox buy? That's the scuttlebutt:
• A high ranking Sinclair source told my colleagues Hadas Gold and Brian Stelter that the Murdochs may look to add Tribune Media to their "New Fox" content portfolio.
• NYT's Ed Lee and Amie Tsang report that Rupert "could restart talks with Tribune to buy the seven stations" that the Murdochs were planning to buy from Sinclair, "or possibly more."
We haven't heard anything from inside Fox about this ... yet.
What Tribune CEO Peter Kern says:
• "We feel the environment remains welcoming and open to sensible consolidation and there's tons of activity out there."
• "I don't think the regulatory environment troubles us. I think what transpired was not the result of an unwelcoming regulatory environment but more how this transaction was prosecuted by our merger partner."
Bonus: Read Lee and Tsang's tick tock on how the deal fell apart. | | Court of Chancery
Sumner's surprise
Big in Delaware: Sumner Redstone quietly put a provision in place to limit his heirs from selling their controlling stakes in CBS and Viacom, a surprise provision that complicates efforts to sell the companies to larger buyers.
WSJ's Keach Hagey explains:
• "The trust that will control Viacom and CBS when the 95-year-old media mogul dies or is deemed incapacitated ... prohibits the trustees from entering into any merger that would leave shareholders with less than 30% voting control of the resulting business."
• "That and other provisions of the trust may have significant implications for CBS and Viacom investors, particularly at a moment when the media industry is awash in deals and both companies are considered potential takeover targets."
The Big Picture: Les Moonves is fighting Shari Redstone's effort to merge CBS and Viacom because he believes a stand-alone CBS is better positioned for a sale. This provision complicates efforts to sell the company at all.
Curb Your Enthusiasm: Meredith Kotler, the lawyer for the Redstones' holding company, said trustees can amend the provision. | | Samsung & Spotify
Daniel Ek's new hardware
Longtime readers of PACIFIC are familiar with our feelings on Spotify's long-term viability. Despite having the most subscribers, it's been our opinion from day one that Daniel Ek was at a disadvantage ... because:
• Spotify offers the same content as deep-pocketed tech giants who have already woven their way into the fabric of people's every day lives.
• Spotify lacks the hardware distribution its competitors have in iPhone, HomePod and Echo, respectively.
Ek has solved the second problem: Samsung has signed Spotify as its music service provider, putting the streaming service on all Samsung phone, TV and speaker devices.
The Big Picture, via Verge's Chaim Gartenberg: "Spotify is now part of the setup experience on Samsung devices, and Spotify and Samsung accounts will eventually be able to be linked for smart home integration with Samsung's SmartThings app."
What's Next: "Samsung and Spotify are also pointing out that this is merely the start of the partnership," Gartenberg reports. "More functionality is presumably planned for the future." | | Sound Systems
Amazon wants your car
What Automakers are Reading:
• "Amazon is giving more automakers access to the tools needed to integrate Alexa into their vehicles' infotainment systems," Engadget's Mallory Locklear reports. "The company released its Alexa Auto software development kit today, making the tools accessible to all developers via GitHub." | | Pay to Play
Steve Burke's stream play?
Comcast's NBCUniversal is considering launching a streaming service called Watch Back. What's different about this one, the Information's Tom Dotan and Jessica Toonkel report, is that NBC would pay people to watch it:
• "Watch Back ... would feature episodes of TV shows and web series from NBCUniversal's own TV networks ... as well as those from outside web sites."
• "To entice people to watch, Watch Back viewers would earn points that could be redeemed for gift certificates."
• "NBCUniversal hasn't decided whether to launch Watch Back.... Another idea ... is to launch a service that would include only shows from NBCU channels."
The Big Picture, via THR's Natalie Jarvey: "Watch Back won't be the Comcast-owned company's answer to CBS All Access and HBO Now. ... Instead, it will be used primarily as a marketing tool to pull viewers into the NBCU fold [with] some full-length programming ... as well as web-friendly clips." | | The Stream
Don't sleep on Roku
"Roku Is Small But Mighty in Streaming Wars," Bloomberg's Tara Lachapelle reports. "The $5 billion business is holding its own against Amazon and Apple the way companies in other industries pray they can":
• "Viewers streamed more than five billion hours of TV and movies in the second quarter ... Roku took the largest share of those viewing hours among all connected-TV platforms, mobile devices and computers, according to a report by Conviva."
• "Roku [also] had more video plays ... [and] users tend to stream for longer on Roku than any other platform."
The Big Picture: "Roku is holding its own [against deep-pocketed tech giants] and proving an important vehicle to migrate more viewers to streaming and connect them with advertisers." | | What Next: Gen Z. Bloomberg's Riley Griffin says members of the demographic born after 1996 are online "almost constantly," and more than 70% of them influence their family's spending.
See you Monday. | | | | | |
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