Scripps Networks appears to be running out ahead in the chase to buy the Travel Channel from cable company Cox Communications. News Corp. ran Scripps close and pushed the price higher than had been widely anticipated.
The deal, which could be announced this week values the Travel Channel at about $1 billion which many feel is rich for the current market. Cox will retain a 35 percent stake in the company, which will be spun off into a joint venture with Scripps, which owns a stable of cable networks including the Food Network, DIY Network and HGTV.
The structure will allow Cox to dodge a steep tax bill left over from the transaction it made with the media mogul John Malone in 2007 to exchange its interest in Discovery Communications for an interest in the Travel Channel.
In June Cox said it had received unsolicited inquiries about the channel unit and hired Goldman Sachs to evaluate its options. At the time, analysts said the channel’s value was between $600 million and $700 million.