Chernin Group, AT&T take majority stake in Fullscreen YouTube network

After recent speculation, AT&T Inc. and the Chernin Group announced on Monday that their joint venture, Otter Media, will acquire a majority stake in the popular YouTube video network Fullscreen Inc.

Financial terms were not disclosed by the companies, but a person close to the transaction said the deal puts Fullscreen’s valuation at $200 million to $300 million. The transaction is expected to close within the next month.

Earlier this year, Chernin and AT&T formed Otter Media to invest more than $500 million in online video services. The goal, the companies said, was to invest in advertising and subscription video-on-demand channels and streaming services.

Founded in 2011, Culver City-based Fullscreen, which has helped boost the popularity of many YouTube stars, has built more than 50,000 channels with 450 million subscribers and gets about 4 billion views a month. The company’s talent roster includes such stars as the Fine Bros., O2L and Jack and Jack.

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FOR THE RECORD

An earlier version of this post said Fullscreen has built 15,000 channels with 200 million subscribers.This post has been updated with the latest Fullscreen numbers.

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“Fullscreen’s support for content creators, its relationship with YouTube and its passion for delivering entertainment to youth audiences around the world are extremely appealing to us,� Peter Chernin, chief executive of the Chernin Group and former Fox president, said in a statement.

Fullscreen CEO and founder George Strompolos will stay on as CEO and maintain a stake in the company.

“This is a huge win for Fullscreen and our creators,� Strompolos said in a statement.

The deal is the latest in a string of acquisitions of multichannel networks, or start-ups that help YouTube stars earn revenue, as consumer appetite for YouTube videos grows.

DreamWorks Animation purchased YouTube teen network AwesomenessTV for $33 million last year. This year, Walt Disney Co. acquired YouTube network Maker Studios in a deal worth up to $950 million.

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