Global media behemoth Viacom has acquired the Los Angeles-based free over-the-top service Pluto TV for US$340 million in cash.
It’s expected that Pluto TV will operate as an independent subsidiary of Viacom once the transaction closes, which it’s expected to do so during the first quarter of 2019 upon customary closing conditions and regulatory approval. Tom Ryan, Pluto TV co-founder and CEO, will continue in his role as CEO of the AVOD once the transaction concludes.
Founded in 2013, Pluto TV is an ad-supported, internet-based television service that features programming sourced from more than 130 partnerships with media networks, film and television studios and a range of digital content producers. Pluto TV currently has 12 million monthly active users who can stream 100-plus channels with on-demand content spanning television, movies, sports, lifestyle, and more.
According to a release from Viacom, its acquisition of Pluto TV will “advance Viacom’s key strategic priorities, including expanding its presence across next-generation distribution platforms and growing its advanced advertising business.”
Viacom notes that the benefits of this transaction include providing Viacom with direct access to millions of consumers, and a new distribution outlet for Viacom Digital Studios’ content beyond the existing AwesomenessTV channel (which Viacom acquired this past July) on Pluto TV.
Additionally, Viacom says its global footprint, portfolio of entertainment brands, content library and additional marketing resources will help Pluto TV expand internationally.
Paul Hastings, Covington & Burling and Shearman & Sterling served as legal counsel to Viacom. Gunderson Dettmer and Hogan Lovells served as legal counsel to Pluto TV, and LionTree Advisors served as financial advisor to Pluto TV.
“Today marks an important step forward in Viacom’s evolution, as we work to move both our company and the industry forward. Pluto TV’s unique and market-leading product, combined with Viacom’s brands, content, advanced advertising capabilities and global scale, creates a great opportunity for consumers, partners and Viacom,” said Viacom president and CEO Bob Bakish in a statement.
“As the video marketplace continues to segment, we see an opportunity to support the ecosystem in creating products at a broad range of price points, including free. To that end, we see significant white space in the ad-supported streaming market and are excited to work with the talented Pluto TV team, and a broad range of Viacom partners, to accelerate its growth in the U.S. and all over the world.”