Apollo Global Management has agreed to acquire CKx, a media company that owns the rights to singing competition reality show “American Idol” for around $509 million in cash, according to a statement from Apollo.
Under the deal Apollo will pay $5.50 a share, representing a 25 percent premium to CKx’s closing price on Monday 9 May, and a 40 percent premium to the company's six month average share price.
American Idol: now
CKx, short for “Content is King”, also owns the rights to the Elvis Presley image, including the singer’s Graceland mansion, and the rights to boxing legend Muhammad Ali.
Leon Black-led Apollo, which will make a board-endorsed tender offer soon, has already won the support of a trust run on the behalf of Lisa Marie Presley, which is CKx’s partner in “Elvis Presley Enterprises”, and media entrepreneur Robert Sillerman, who owns a significant stake in CKx, according to the statement.
The American Idol show has recently experienced a hiccup in ratings but has since rebounded with the addition of Aerosmith singer Steven Tyler and actress and singer Jennifer Lopez as judges following the departure of Simon Cowell. Cowell will now judge on “The X Factor”, a rival talent competition program to air this fall.