March 7th 2013 - By Emily Steel in New York
Finance firm gets its prints all over CSI
So crime does pay. CSI: Crime Scene Investigation has tracked down more cash, with entertainment finance firm Content Partners acquiring a 50 per cent stake in one of the most popular television franchises in history.
While terms of the deal were not disclosed, a Goldman Sachs affiliate was reportedly seeking about $400m for its holding, which it has owned since 2007. CBS, the media group, owns the other half of the franchise and will continue to control its domestic and international distribution rights.
Now in its 13th season, the American crime drama follows Las Vegas detectives who solve murder mysteries in gritty hour-long episodes that have spawned two offshoots – CSI: New York and CSI: Miami.
The hit franchise has ranked as the world's most-watched TV series for five of the past seven years. Its library includes 724 episodes.
A combination of domestic, international and digital distribution rights deals for CSI have proved to be a big money maker for its owners, long after the episodes first air on broadcast TV.
Leslie Moonves, chief executive of CBS, said in December that the half of the CSI franchise that CBS owns has made $2.5bn for the media group during the life of the series.
CSI is a testament to the long-term value of hit franchises, especially in the digital era with the proliferation of new technologies for TV-watching.
"Several major tech companies around the world are spending millions, even into the billions, to improve the viewer experience, even expand on it," said Steven Blume, chief operating officer of Content Partners.
"We believe that all that spending that is going on now will ultimately lead to increases in long-term value of this type of high-quality programming."
The deal represents the largest acquisition to date by Content Partners, a Los Angeles-based firm that specialises in investing in royalties from TV and film entertainment. The group owns a stake in five TV series and 119 films, including the superhero comedy Hancock, the drama The Pursuit of Happyness and the American Pie comedy series.
Goldman Sachs has owned half of the CSI franchise since 2007, when it acquired an interest in CSI co-producer Alliance Atlantis, a Canadian entertainment company. Walt Disney's television division first developed the CSI series with creator Jerry Bruckheimer before it retreated from the show. CBS scooped it up and sought out a partner in Alliance Atlantis to help pay for production costs.
Whether CSI stays a hit remains to be seen, but Content Partners is making a bet on the long-term value of the franchise.
"More episodes doesn't hurt," Mr Blume says. "Either way, there is tremendous value in the existing episodes."
LionTree acted as a financial adviser to Content Partners on the transaction. Bank of America Merrill Lynch and JPMorgan provided financing for the transaction.