A prospective sale of CNN to former CEO, Jeff Zucker, who was ousted last year due largely to an affair with a staffer, has raised concern based on his financial ties to the United Arab Emirates.
On Monday, foreign influence regulation expert, Ivan Schlager of Kirkland & Ellis, expressed concern that the sale to Zucker could be a problem based on the possibility that the UAE could be quiet investors. Schlager also expressed concern over increasing multiple high-profile sales involving funding from Saudis and Quataris, according to the Daily Mail.
Lamenting the prospect of ‘another Al Jazeera’ to Semafor, Schlager said there was still hope – if Congress blocks the deal over concerns of foreign backing.
He cited how a similar sale of Forbes to Indian investment firm Sun Group has been held for months over such political concerns.
In this case, Schlager said, a foreign-backed bid for CNN could trigger ‘the mother of all Committee on Foreign Investment [CFIUS] reviews’, leaving the prospective sale in figurative limbo similar to that of Forbes.
He said if the full amount of the UAE’s part in the investment comes as more than 25 percent of the total, he expects Congress to vet the transaction accordingly.
Within the past year, Zucker’s RedBird Capital Partners and Abu Dhabi-based International Media Investments, formalized plans for a joint venture, pledging $1 billion in funds for “large-scale” media and sports investment opportunities.
Last year CNN lost around $500 million in profits, and has seen many longtime hosts depart, such as Don Lemon, who was let go after multiple, highly criticized gaffes, and the departure of Chairman and CEO, Chris Licht, after just one year at the helm.
