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Relativity Media tries to outbid Disney for Maker Studios

Lloyd Ahlquist and Peter Shukoff creators of "Epic Rap Battles."
Lloyd Ahlquist and Peter Shukoff creators of “Epic Rap Battles.”
(Kirk McKoy / Los Angeles Times)
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Relativity Media is hoping to outbid the Walt Disney Co. for the popular YouTube network Maker Studios.

Relativity, a Beverly Hills-based entertainment company, has offered to pay $525 million in cash and stock for the Culver City digital media company, plus as much as $500 million more depending on the financial performance of the company, according to a person familiar with the deal.

Relativity has also offered a bonus pool worth $75 million for “key talent and executives,” this person said.

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This comes as privately held Maker’s shareholders prepare to vote on a agreement to be bought by Disney in a deal worth up to $950 million.

Disney said last month that it will pay $500 million to Maker shareholders, plus as much as $450 million more, depending on Maker’s performance after the acquisition. The vote is expected to take place this week for the transaction expected to close during Disney’s fiscal third quarter.

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Relativity confirmed in a statement that it has sent an offer letter to Maker, saying it believes that its proposal is superior to Disney’s.

“Relativity and Maker Studios are natural partners,” Relativity said in its statement. “We both share a commitment to challenging the status quo, breaking down old models that don’t work and inventing new ones that do.”

Maker, founded in 2009, is best known for its videos aimed at millennial viewers, who increasingly go online for video entertainment. Best known as the company behind YouTube successes such as “Epic Rap Battles of History” and PewDiePie, Maker has about 55,000 YouTube channels with 380 million subscribers and 5.5 billion views per month.

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Relativity’s recent films include the micro-budget horror movie “Oculus,” the Kevin Costner thriller “3 Days to Kill” and the Navy SEAL action flick “Act of Valor.”

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ryan.faughnder@latimes.com

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Twitter: @rfaughnder

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