Having Found a Buyer For Grass Valley, Technicolor Now Sells Majority of its Stake in Screenvision

Posted by Joe Zaller
Sep 27 2010

As part of its previously published strategy of refocusing its efforts on content creators and network service providers, Technicolor announced today that it has sold the majority of its ownership stake in cinema advertising company Screenvision US for $60m in cash.

The buyer is the Shamrock Capital Growth Fund II, a private equity fund focused on media, entertainment and communications.

Technicolor, which called the sale “another important milestone in our disposal program,” says it will apply the proceeds of the transaction towards repayment of its Disposal Proceeds Notes (DPN), which totaled €260m as of the company’s last earnings release.  Technicolor’s “disposal program” includes the previously announced deal whereby Francisco Partners has agreed to acquire Grass Valley.

Under the terms of the deal, Technicolor will receive $60m in cash in exchange for a portion of its 50% ownership in Screenvision, which was previously a joint-venture between UK broadcaster ITV plc and Technicolor. 

Technicolor will retain an 18.8% interest in a newly-formed Screenvision holding company, along with one seat on the new company’s board of directors.

Interestingly, Technicolor will continue to provide services to Screenvision.  According to Technicolor CEO Frederic Rose, “We will keep a minority stake in Screenvision due to our close business relationship and will continue to be Screenvision’s provider of both film and digital services.”  According to the company’s press release, the film processing & distribution agreement extends through end of life.

The transaction is pending regulatory approval and customary closing conditions and is expected to close in the fourth quarter 2010.

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You can read the full Technicolor announcement of the sale here.

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