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Crown Media Calls Off Sale

Apr 17, 2006  •  Post A Comment

Crown Media Holdings said Monday it is calling off its planned sale, saying the strong performance of Hallmark Channel has buoyed management’s confidence in the future of the company.

Also Monday, the company announced that Chris Moseley, executive VP and chief marketing officer, will leave her position at the end of the month to pursue other interests.

The news sent Studio City, Calif.-based Crown’s shares tumbling more than 16 percent Monday afternoon to $4.84 a share, down 96 cents from Thursday’s close. Friday was a trading holiday.

“We worked diligently with the special committee and our financial advisors to evaluate various strategic initiatives,” said Crown Media CEO David Evans. “Ultimately, the board determined that the greatest value for our shareholders will be derived by our continued operation of our business.”

Mr. Evans noted that the company’s full-year results, which were driven by strong ratings, advertising and affiliate-fee growth, indicated Hallmark Channel’s “underlying business fundamentals are in place to enhance the value of Crown Media by building a more successful business.”

Crown announced in August that it was exploring selling the company. However, analysts said interest in the channel was modest, due in part to the price tag of the company’s film and television show library, which many called expensive.

Also dogging the channel was a high level of debt and a perception that its audience skews older.

Ms. Moseley’s decision to leave comes after nearly six years with the company, during which Mr. Evans said she was instrumental in helping to build Hallmark Channel’s ratings through her crafting of a global brand strategy as well as the network’s cross-platform partnerships during holiday seasons with affiliate partners, national advertisers and Hallmark Gold Crown stores.