NUVOtv and parent company SíTV Media have finalized their acquisition of Fuse, which was purchased in April from the Madison Square Garden Company for $226 million. MSG will receive a 15% equity in the combined company, subject to potential reduction based on certain performance goals.
An English-language cable network targeting Hispanic millennial audiences, NUVOtv is estimated to be available in over 34 million pay-TV households by the end of 2014, according to analytics firm SNL Kagan. With the addition of Fuse's 73 million households, Nuvo's reach will more than triple. "We are pleased with the overwhelmingly positive response by the financial community and other stakeholders to this transaction. It is confirmation of the value we recognized in Fuse and our growth plans," SíTV Media CEO Michael Schwimmer said in a statement.
NUVO's chief creative officer Jennifer Lopez recently spoke to Billboard about the impending acquisition at NUVOtv's upfront presentation to advertisers in New York, noting, "The fact that it's a music channel, which is so near and dear to my heart, I just feel I know exactly what we need to do. We're gonna get together and figure out what that is, once the deal is completely finished." Lopez is also a minority investor in the NUVO, with an estimated $2 to $3 million stake in the network.
Lopez has already been involved with meetings from day-to-day production of NUVO series like "A Step Away" and "The Collective" to meet-and-greets with cable operators who could potentially distribute the still-fledgling network, currently available in 34 million homes. "What has really impressed everyone here is her high degree of focus and commitment - while she's busy, she's been very dedicated over the last 12 months," says Schwimmer recently told Billboard.
Prior to the acquisition's close, Fuse shed roughly 50% of its 200-person staff, as well as pulled the plug on "Fuse News," a half-hour news program launched in January 2013 with celebrity hosts like Jack Osbourne and Alexa Chung. Though NUVO and Lopez beat out Sean Combs' Revolt TV in the bid to acquire Fuse, the changes were already in the works at MSG, according to multiple executives familiar with the company's plans.
"Fuse News" often rated at the very bottom of Nielsen's cable rankings, when it rated at all. "Things were so bad that it got what TV industry people call ‘hashmarks,' or no registered audience," says one executive familiar with Fuse's history. "They'd talked about a news division for years and wanted to be for music what ESPN was for sports, but it didn't pan out." Another executive with familiar with Fuse's plans notes that the "Fuse News" programming model and talent contracts prevented content from living online. "Plus, the news programming was expensive – too expensive for it to not go online and continue to live there."
Schwimmer declined to elaborate on the company's plans for Fuse prior to the deal closing, but acknowledged the natural synergies between Nuvo's own music news program "The Collective," powered by Vevo, which was recently renewed at the network's upfront presentation. "Let's just say when you're getting ready for the merger of two networks, there's natural alignments and organizational changes which occur in any industry," Schwimmer says.