makerstudiosUPDATE, 2:35 PM: Nearly two weeks after the first report surfaced about an acquisition of the multichannel YouTube network, the studio made it official today. Disney said Maker Studios shareholders will be compensated to the tune of $550M plus a “performance-linked earn-out” of as much as $450M more. The full release is below the original story.

disney6PREVIOUSLY, MARCH 11: The deal isn’t set, but if it makes, it would represent the biggest bet yet that a Hollywood studio has made in a company built on YouTube, the world’s largest video site. Disney reportedly is in talks to buy Maker Studios for at least $500 million, Re/Code reports, citing people familiar with the negotiations. According to Maker Studios, the multichannel network generates 5.5 billion video views a month, with almost all of its content on YouTube. This is the latest move by a traditional media company to expand its focus on digital content. Just yesterday we reported on Warner Bros leading an $18 million financing effort for Machinima. a YouTube network aimed at gamers and other young men. Online video company FullScreen also scored an investment led by Comcast and others, and in May DreamWorks Animation agreed to pay $33 million for YouTube destination AwesomenessTV. The reported talks also come after Disney’s announcement last week that it was laying off 26% of its interactive division.

Related: Is Google Growing Its Own Online Video Competition?

Your Head Likes
6 months
Once again, these big Entertainment Corporations have no idea how the internet works or how to approach...
demopublican
6 months
Is this a joke? Their about page is slicker than a SV startup company's Wallstreet keynote. Only...
Shaytards fan
6 months
So happy for Shaycarl, Kassem G, Lisa Nova, Ben. I am HUGE fan of Shaytards!!!!! Youtube is...

BURBANK, Calif., March 24, 2014 – Furthering its goal of bringing content to consumers on all the platforms they prefer, The Walt Disney Company (NYSE:DIS) has agreed to acquire Maker Studios, the leading network of online video content on YouTube.
Maker Studios shareholders will receive total consideration of $500 million, and a performance-linked earn-out of up to $450 million if the strong performance targets are met.

With more than 55,000 channels, 380 million subscribers and 5.5 billion views per month on YouTube, Maker has established itself as the top online video network for Millennials.

By acquiring Maker Studios, Disney will gain advanced technology and business intelligence capability regarding consumers’ discovery and interaction with short-form online videos, including Disney content.

“Short-form online video is growing at an astonishing pace and with Maker Studios, Disney will now be at the center of this dynamic industry with an unmatched combination of advanced technology and programming expertise and capabilities,” said Robert A. Iger, Chairman and Chief Executive Officer, The Walt Disney Company.
“Disney is synonymous with the best entertainment and is the ideal partner for us, strengthening our position as the leading player in online video,” said Ynon Kreiz, Executive Chairman and CEO of Maker Studios.

Maker Studios will report to Disney Chief Financial Officer Jay Rasulo. Maker Studios will remain headquartered in Culver City, Calif., with operations in New York and London.

The transaction, which is subject to regulatory clearances, is expected to close in Disney’s third fiscal quarter.