The deal, which was signed on Tuesday and announced yesterday, sees Desmond’s holding company Northern & Shell receive a return of more than four times the £103.5m investment it made four years ago.
“Since Northern & Shell’s acquisition of Channel 5 in 2010, the financial and operating performance of the business has been transformed with improved audiences and content offering,” said Channel 5’s operations chief Paul Dunthorne.
Viacom, which owns a stable of US channels including MTV, Nickelodeon, Comedy Central and movie studio Paramount Pictures, said the deal would allow it to introduce its popular content to new UK audiences.
BSkyB is also expected to be boosted by the deal as it currently handles the UK TV advertising sales for the US broadcaster under a deal which will likely be expanded to include Channel 5’s advertising sales.
Ian Rosenblatt, founder and partner of Rosenblatt Solicitors which acted on behalf of Channel 5 and Desmond on the deal and whose relationship with both extends over 30 years, told City A.M.: “The last few days have been hectic with Viacom being chosen as the winning bidders just last weekend. Work on the deal started on Sunday, going day and night until Tuesday evening.”
Northern & Shell was also advised by Barclays and Viacom was advised by Sherman & Sterling, Olswang and Lewis Silken and its banking adviser was Goldman Sachs.