EXCLUSIVE: In a deal worth just under $12 million, PalmStar Media has acquired all the assets of National Lampoon. That includes the trademark, and a library of print, audio and movie content spanning nearly 50 years. Raj B. Singh and Kevin Frakes will be National Lampoon co-CEOs of behalf of their financial partners who include Bobby and Buddy Patrick, as well as Charlotte Ubben and Michael Tennant. A full staff is in place and operating from PalmStar headquarters in Los Angeles and Philadelphia.

Palmstar

Singh and Frakes said they have already doubled that initial investment, to facilitate the deal and quietly assemble the first new film, TV and digital projects they will unveil in the coming weeks. The goal is to rechristen a brand once associated with comedy’s brightest minds, but which for more than a decade has existed as a running bad joke. Singh and Frakes said they worked for over a year to free the distressed asset and got it done in late June. If they are successful, they believe the acquisition price will go down as a tremendous bargain.

“We sniffed out an opportunity and went after it,” Frakes told Deadline. “We did due diligence and since last October, we’ve been negotiating exclusively with the board. We have been quietly operational for about six months and have made alliances with a number of strategic partners. Working with PalmStar, we’ve started toward putting together big quality movies with strong talent. The play for Raj and I is to use PalmStar’s ecosystem to buy content and green light movies, TV and other platforms, using the brand on them to build a business. We have put together half a dozen movies in the last year. PalmStar has been involved in 42 movies over five years. Now, we have a brand we think can be explosive.”

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They realize they are not the first to attempt to restore a luster that goes back to the 1970s, when National Lampoon assets included a thriving magazine, the stage show Lemmings and the National Lampoon Radio Hour. Those endeavors collectively launched John Belushi, Chevy Chase, Bill Murray, Gilda Radner, Christopher Guest, Harold Ramis and John Hughes. The performers became fixtures of Saturday Night Live. The others were architects of the biggest movie branding successes: Ramis co-wrote National Lampoon’s Animal House with Doug Kenney and Chris Miller, and Hughes wrote National Lampoon’s Vacation, the two biggest branding movie successes.

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There has been little to laugh about, for a long time since. The demise was filled with bad content, lawsuits, debt, stock that became nearly worthless, and two prison sentences for company higher-ups, all chronicled in a long Vanity Fair article in May. Singh said the aim will be to put that stuff in the rear view mirror. Everyone involved in past iterations of the company is gone. Frakes said there was a lack of real investment in new quality content, and too many easy cash deals licensing the name to bad movies that went straight to DVD or got flipped to cable outlets.

“You could call it a distressed asset transaction in that it was based on what creditors were owed and we got it for a number on a balanced sheet for a haircut,” said Singh. “But we think it is worth multiples of what we paid. We viewed it as a pristine asset that had been held hostage. The company was insolvent, and there were a bunch of creditors who would only be repaid if the asset was sold. Technically, we didn’t buy the company, we stripped off 100% of the assets.” The board and shareholder majority approved the deal, they said.

For their money, the buyers “got the diamond,” Singh said. “The most valuable asset is the trademark, the name. We get a clean start with a fresh balance sheet.”

While some recent comedy films have faltered, Hollywood is betting big on brands in this uncertain time. The Onion sold a 40% stake to Univision for $200 million; Vice and Buzzfeed have billion dollar brand valuations, and the digital brand Funny Or Die has a valuation said to be nine-figures, with a largely digital presence.

The new owners said they have put an infrastructure in place, and taken early steps to build content in digital, movies (PalmStar’s core business), TV, digital, stage and live events. They have also begun steps meant to reinvigorate the relationship with Harvard Lampoon and its many alums who’ve gone on to success in creating comedies. Now that they have hung the National Lampoon shingle, Singh and Frakes will unveil the first projects within the next few weeks.

Universal

The deal brings control of legacy content including Animal House receivables (the Vacation rights were sold outright to Warner Bros in 2014 to raise cash as the company struggled), the original Radio Hour broadcasts and magazine content that includes numerous stories by Hughes before he became the director of enduring comedies from Sixteen Candles to The Breakfast Club. There will be opportunities to digitize and exploit that dated classic content, but Singh and Frakes said the priority isn’t remakes. The best way to succeed is to get current comic talent feeling good again about making comedies with National Lampoon, and to make consumers believe again in the brand.

“We want the community to know we’re trying to restore National Lampoon as a comedy institution, a feeder for great talent,” Frakes said. “We don’t have to explain to consumers that National Lampoon is a comedy brand, and the nefarious behavior that took place in the past has no impact on consumers. The schlock, they didn’t see. Older audiences are nostalgic and there is an opportunity to tap into youth brand awareness. Some of this is muscle memory; you don’t have to explain too much what National Lampoon is. You just have to prove that, as a company, you will be coming across with product that is funny. We are investing heavily in human capital, in comedy writer/producers and we are giving them the resources they need. That was what National Lampoon was, a group of funny writers and actors. That will be a big part of our business.”

As a content generator, PalmStar is in production on The Catcher Was A Spy, a drama about baseball player/spy Moe Berg (Paul Rudd is playing him), and is teamed with TriStar on an adaptation of Paulo Coelho’s The Alchemist, among other projects. Recent films it has produced or co-financed include the Will Smith-starrer Collateral Beauty, the John Carney-directed Sing Street, and the M. Night Shyamalan hit Split. Frakes is the largest shareholder in PalmStar, followed by former PeopleSoft COO Peggy Taylor and then Bobby and Buddy Patrick.

In the infrastructure of the new National Lampoon, Charlotte Ubben and Michael Tennant will be vice presidents of development; Tom Daniels is Chief Revenue Office, Brian Fleming Chief Technology Officer; Gian Hunjan exec veep of Digital Media, and J Stuart will be director of Acquisitions/Development for features. PalmStar was repped in the transaction by David Blood, Nick Pujii and Jon Picard of Dentons. Frakes was repped by Cohen Gardner’s Jonathan Gardner.