Apollo Global Management to buy American Idol owner for $509 million

Apollo Global Management yesterday signed a deal to cquire CKx, the entertainment company that owns America's most popular Television show 'American Idol,' for about $509 million in cash.

The New York-based Private equity firm is paying $5.50 a share, representing a premium of 40 per cent to CKx's closing price over the past six months and a 25 per cent premium to yesterday closing price.

New York-based CKx, whose initial 'C' and 'K' stand for Content is King, was founded in 2005 and owns and develops entertainment content and intellectual property.

Apart from owning the proprietary rights to the Idols television brand, including the American Idol series in the US and local adaptations of the Idols television show format which, collectively, air in over 100 countries around the world, the company also owns the global rights to the name, image and likeness of Elvis Presley, the operations of Graceland, the rights to the name, image and likeness of Muhammad Ali.

American Idol, which is broadcasted twice a week on News Corp's Fox network is the most popular show in the US and currently has more than 24.8 million viewers. The show attracted more viewers this season after producers brought in Steven Tyler and Jennifer Lopez as judges following the departure of Simon Cowell.

The board of CKx has approved the merger agreement and has resolved to recommend that CKx stockholders approve the merger. Apollo has also obtained support agreements from two significant stockholders, The Promenade Trust, the sole beneficiary of which is Lisa Marie Presley and which is the company's partner in Elvis Presley Enterprises, and Robert Sillerman, the Company's largest stockholder.