Sony Weighed Selling Stake in Crackle to ’Save the Year’

Sony Pictures Television President Steve Mosk
Steve Mosko, President of Sony Pictures Television. Photographer: Charley Gallay/Getty Images for Crackle

Sony Pictures Television has weighed selling a majority stake in Crackle, the online video company best known for Jerry Seinfeld’s “Comedians in Cars Getting Coffee,” according to e-mails made public by hackers.

Executives at Sony have discussed a deal with Evolution Media Capital, an investment bank backed by Hollywood talent firm Creative Artists Agency, according to a Nov. 3 e-mail from Eric Berger, the general manager of Crackle.

An outside investment in Crackle would free up cash the website could spend on original series and marketing, Berger wrote in an e-mail to Steve Mosko, president of Sony Pictures Television. The company would also improve its balance sheet with proceeds, as Sony executives discussed months earlier.

“If we sold 51%/control at a total valuation of $200 mi, for the sake of the example, we’d bring in $100 mil in cash and probably more importantly, book a gain of something like $125 mil,” Andy Kaplan, president of worldwide networks at Sony Pictures Television, wrote in an Aug. 1 e-mail. “Save the year.”

The e-mails are included in thousands of documents stolen from Sony’s computer system and uploaded to the Internet in a devastating cyberattack. The data include salary spreadsheets for 6,700 employees of Sony Pictures and Social Security numbers of celebrities.

Michael Mand, a spokesman for CAA, and Paula Askanas, a spokeswoman for Sony Pictures, both declined to comment.

Original Video

Sony Corp. has been trying to cut costs within the entertainment unit. Chief Executive Officer Kazuo Hirai said in November 2013 that the company would eliminate $250 million in costs at its entertainment units over a two-year span.

Sony acquired Crackle for $65 million in 2006, when it was known as Grouper. It rechristened the site Crackle in 2007, and has since used it to offer movies and television shows from Sony’s library, as well as original videos like the Seinfeld series and an upcoming sequel to the movie “Joe Dirt.” Crackle will spend $10 million to license content in 2015, Berger told Mosko.

Traditional media conglomerates have splurged on online video properties over the past year. Walt Disney Co. acquired Maker Studios for $500 million in May, while Vice Media Inc. raised $500 million in a pair of deals that valued the company at more than $2.5 billion. Comedy organizations have been a popular target of late, as both the website Funny or Die and The Onion have explored strategic options, including a sale, Bloomberg News reported last month.

Evolution Media Capital managing partner Rick Hess met with Sony’s Berger in October. He and CAA president Richard Lovett followed up with e-mails to Mosko.

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