Roku paid $97.8 million in cash for This Old House Ventures, the home-improvement media company whose shows include “This Old House” and “Ask This Old House.”
Roku disclosed the price tag in its 10-Q quarterly filing Friday. The company said it acquired the This Old House business because it “believes the content aligns with The Roku Channel’s ad-supported growth strategy.”
Roku did not disclose the terms of the January 2021 acquisition of Quibi, which includes more than 70 short-form shows ordered by Jeffrey Katzenberg’s now-defunct startup. Sources previously said that deal was valued at significantly less than $100 million. Roku is introducing the Quibi programming under the “Roku Originals” brand, which also will encompass future original programming.
As of March 31, 2021, Roku recorded $104.6 million in content assets to its balance sheet as non-current assets. The increase of $96.7 million in non-current content assets in Q1 “was primarily driven by content acquired from Quibi and This Old House,” Roku said in the filing.
Roku also recorded $5 million in goodwill on its balance sheet for Q1 from “other immaterial acquisitions.” It reported $47.6 million in goodwill for the This Old House acquisition.
Meanwhile, Roku also disclosed that it paid $39.1 million in cash for Nielsen’s Advanced Video Advertising business, which includes automatic content recognition and dynamic ad insertion technologies.
Under the deal for This Old House Ventures, current seasons of “This Old House” (Season 42) and “Ask This Old House” (Season 19) will be available for free on The Roku Channel as on-demand episodes. New episodes will come to the streaming platform after they air on local PBS stations.
PvNew previously reported that Roku was paying under $100 million for This Old House Ventures. Roku bought the company from private-equity firm TZP Group (which had acquired it in 2016 from Time Inc.). With the deal, about 55 employees of This Old House Ventures are joining Roku, including CEO Dan Suratt and the team behind the shows.
Roku said it incurred $2.2 million in acquisition-related expenses for the This Old House deal, which it recorded in general and administrative expenses.
Roku is acquiring all of Stamford, Conn.-based This Old House Ventures’ business. The deal gives Roku ownership of global content distribution rights and all subsidiary brands, including the “This Old House” and “Ask This Old House” TV programs, show libraries of more than 1,500 episodes, all digital assets and the company’s TV production studio in Concord, Mass. (The Roku deal does not include “New Yankee Workshop.”)
During Q1 2021, Roku said, The Roku Channel reached U.S. households with an estimated 70 million people — more than doubling from Q1 2020. Overall, Roku gained 2.4 million new active accounts in the quarter to hit 53.6 million, a slight slowdown from 2020’s growth rates. The company smashed analyst expectations for Q1, posting an unexpected net profit of $76.3 million and total sales up 79%.
Meanwhile, Roku is currently embroiled in a contract dispute with Google: Roku removed the YouTube TV app from its channel store on April 30, alleging the internet giant was seeking anticompetitive terms to distribute the core YouTube app. Google on Friday responded by announcing that it will add a feature to the main YouTube app that will let users access YouTube TV (starting with Roku devices).
