The National Geographic Society and 21st Century Fox expand joint venture in media
Deal means Murdoch’s broadcast and film company now owns a controlling interest in National Geographic magazine and its branded TV channels and will be a for-profit media company, while the National Geographic Society’s endowment will grow to nearly $1 billion allowing it to grow its non-profit activities
The National Geographic Society, publisher of National Geographic magazine, and 21st Century Fox, Rupert Murdoch’s broadcast and film company that recently split off from News Corp, will expand their joint venture in in National Geographic Channels. The move means that 21st Century Fox will now be the majority owner of the new company, National Geographic Partners, with the National Geographic Society now owning 27 percent of the business.The venture will now be led by Declan Moore, currently National Geographic’s chief media officer, and includes the branded cable channels, the 127-year-old print magazine, digital and social platforms, maps, travel and other media, according to National Geographic.
What this means from a business perspective is that the media efforts are now a for-profit entity, while the Society itself can continue with its non-profit work. But signing the venture will increase the Society’s endowment to nearly $1 billion which is used for science, exploration and education.
The two partners valued the deal at $725 million.
Here is the announcement for the deal:
Washington, D.C. and New York, NY – September 9, 2015 – The National Geographic Society and 21st Century Fox announced today that they have reached an agreement to expand their highly successful 18-year partnership through which they have owned and operated the properties in National Geographic Channels, a joint venture of domestic and international cable television channels which together reach more than 500 million households globally.
The National Geographic Society is a 501(c)(3) non-profit organization focused on its mission of science, exploration and education. Consideration for the transaction is valued at $725 million. As a result, the Society’s endowment will significantly increase to nearly $1 billion. The new entity will be owned 73 percent by 21st Century Fox and 27 percent by The National Geographic Society with a shared governance structure and equal representation on the board of directors. The Board Chair will alternate annually, with Gary Knell, National Geographic Society President and CEO, serving as the Board’s first Chairman.
The new expanded joint venture will operate as National Geographic Partners and will combine the National Geographic television channels with National Geographic’s other media and consumer-oriented assets, including: National Geographic magazines; National Geographic Studios; related digital and social media platforms; books; maps; children’s media; and ancillary activities, including travel, location-based entertainment, archival sales, catalog, licensing and ecommerce businesses. Combining these assets into one organization will create greater opportunities to pursue National Geographic’s mission of increasing knowledge through science, exploration and research.
Declan Moore, a 20-year veteran of the Society currently serving as Chief Media Officer, has been appointed CEO of National Geographic Partners.
“The expansion of our nearly two decade partnership with 21st Century Fox is another milestone for The National Geographic Society, which for much of its 127 years has sponsored groundbreaking scientists and explorers and shared the knowledge and wonder with the world, using the best and most creative media platforms of each era,” Mr. Knell said. “The value generated by this transaction, including the consistent and attractive revenue stream that National Geographic Partners will deliver, ensures that we will have greater resources for this work, which includes our grant making programs that support scientists and explorers around the world. As media organizations work to meet the increasing demand for high quality storytelling across multiple platforms, it’s clear that the opportunity to grow by more closely aligning our branded content and licensing assets is the right path. We now will have the scale and reach to continue to fulfill our mission long into the future. The Society’s work will be the engine that feeds our content creation efforts, enabling us to share that work with even larger audiences and achieve more impact. It’s a virtuous cycle.”
James Murdoch, CEO of 21st Century Fox, said: “We are privileged to have the opportunity to expand our partnership to continue to bring to audiences around the world, ‘The world and all that is in it,’ as National Geographic Society’s second president Alexander Graham Bell stated more than a century ago. We believe in the Society’s mission of bringing the world to audiences through science, education and exploration.”
Mr. Murdoch added: “We’re working hard to focus our portfolio on brands that have unquestionable consumer appeal. This expanded partnership, bringing together all of the media and consumer activities under the National Geographic umbrella, one of the most treasured names in the world, creates vast opportunities and enables this business to be even more successful in a digital environment. In addition, we look forward to benefitting from Declan’s leadership and his keen ability to make the spirit of National Geographic come to life every day through rich storytelling across media for millions around the world. We’re very excited and honored to work with the Society’s extraordinary explorers, scientists and visual storytellers to propel their incredible work to audiences around the globe.”
The additional resources will enable The National Geographic Society to basically double its investment in an array of science, research and education programs. Plans include the creation of the National Geographic Grosvenor Center for Education, dedicated to improving the geographic skills of high school students, and the establishment of Centers of Excellence in Cartography, Journalism and Photography, which will develop and fund innovations in exploration, mapping and story-telling. The National Geographic Museum, thought leader forums, and related programs will remain under the Society’s purview, all with the support of a focused philanthropic development team.
“The National Geographic Society Board of Trustees truly believes that this expanded partnership with 21st Century Fox well positions our institution for today and for tomorrow – in a way that ensures a sustainable future, while protecting and building upon the legacy of our founders,’’ said John Fahey, Jr., Chairman of the NGS Board, and CEO of the Society from 1998 until 2014. “Our partners at 21st Century Fox have been extraordinarily collaborative for nearly two decades, and we are certain that the future is brighter as a result of today’s announcement.”
Closing of the transaction is subject to customary conditions. The transaction is expected to close later this year.