Posts Tagged ‘Broadcast Industry M&A’

Don’t Miss the Fifth Annual “Media Technology Business Summit” at the 2016 NAB Show

Conference Sessions | Posted by Josh Stinehour
Mar 28 2016

Whether you are a supplier, buyer, or investor in the media technology sector, you won’t want to miss the “Media Technology Business Summit” at the upcoming NAB Show.

Now in its fifth installment at the annual NAB Show, this half day session will take place on the afternoon of Sunday April 17th from 1pm to 5pm in room N249 of the Las Vegas Convention Center.

 

Summit-Collateral

 

Similar to prior years, the event will feature executive panel discussions across the entire media value chain.  C-level executives from leading broadcasters, service providers, media technology vendors, and IT vendors will offer candid assessments of the business impact of market developments on their business models, operational practices, and strategic decision making.

As a complement to the panel discussions and keynote presentations, we will also review excerpts from the latest findings of Devoncroft’s Big Broadcast Survey, the industry’s definitive demand-side study of the broadcast and media sector.

We are in the process of confirming the event’s lineup of speakers and panelists.  Once complete, we will post the full agenda.  A preliminary agenda is available from the NAB Show website.

This conference is intended for senior executives from technology vendors, end-users, and investment firms in the media technology sector.  A NAB Show badge is required for admission.

Approximately 500 executives attended this standing-room only event at the NAB Show 2015. We hope to see you there in April 2016.

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

Harmonic Closes Thomson Video Networks Acquisition

Analysis, Broadcast Vendor M&A, SEC Filings | Posted by Joe Zaller
Mar 02 2016

Harmonic+TVN logos

Harmonic said it has completed the acquisition of rival compression vendor Thomson Video Networks (TVN), nearly a month earlier than the April 1, 2016 date predicted in the company’s Q4 and full-year 2015 announcement.

This indicates that conditions of the deal were met ahead of schedule.

In a filing with securities regulators, Harmonic said the completion of the “transaction will be subject to TVN’s reacquisition of its patent portfolio from France Brevets (a third-party patent licensing firm), the receipt of certain historical audited financial statements of TVN prepared in accordance with U.S. generally accepted accounting principles, the receipt of certain regulatory approvals required under French law, and certain other customary closing conditions.”

The Harmonic-TVN deal was structured as a “put option” for TVN’s shareholders.  A put option gives the holder the right but not the obligation to sell shares to the option writer (in this instance Harmonic).  The “put” option is subject to the selling TVN shareholders’ 60-day consultation process with TVN’s employee works council in France.  When/if TVN’s shareholders execute the “put” option subsequent to the consultation process, then the parties would immediately execute a formal purchase and sale agreement.

According to filings with securities regulators, “On February 11, 2016, pursuant to the terms of the Put Option Agreement,” a Harmonic company “entered into a securities purchase agreement (SPA) relating to the purchase of 100% of the share capital and voting rights of Thomson Video Networks.”

The terms of the deal include an initial purchase price of $75,000,000, “subject to customary working capital and other closing adjustments as set forth in the SPA, payable at closing of the transaction. In addition, there may be additional post-closing payments in amounts respectively capped to (i) the difference between €76,000,000 (as converted from euros into U.S. dollars) and $75,000,000, with respect to an adjustment based on TVN’s 2015 revenue, and (ii) $5,000,000, with respect to an adjustment based on TVN’s 2015 backlog that ships during the first half of 2016, all of which at such times and under the circumstances set forth in the SPA.

TVN has changed ownership several times in the past five years.  TVN was divested by Technicolor in 2011 in a management-led buyout sponsored by Fonds de Consolidation & Développement des Entreprises (FDCE) for a reported price of around $8 million.  When Technicolor announced that it had sold TVN to FDCE in 2009, it said that the company had 525 employees and operated in 15 countries, and that its 2009 revenues was €61m.

Institutional investor Edmon de Rothschild Investment Partners then acquired a 49% stake in TVN in December 2014.

“We are pleased to announce the closing of the TVN acquisition,” said Patrick Harshman, President and CEO of Harmonic. “By bringing together two powerhouses in the video industry, we further extend our position as the market leader. With expanded global R&D, sales and support teams, we are accelerating innovation and driving delivery of best-in-class solutions, products, capabilities and support services for our customers.”

 

 

Related Content:

Press Release: Harmonic Completes Acquisition of Thomson Video Networks

Harmonic-TVN — Put Option Agreement and Securities Purchase Agreement

Delayed Purchasing Decisions Drive Harmonic Revenue Down 13 Percent in 2015

Harmonic Announces Binding Offer to Acquire Thomson Video Networks for up to $90 Million

Press Release: Harmonic Announces Binding Offer to Acquire Thomson Video Networks

Press Release: Thomson Video Networks Receives Harmonic Group’s Acquisition Offer

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© Devoncroft Partners 2009-2016. All Rights Reserved.

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SES to Acquire RR Media for $242 Million in All-Cash Deal

Analysis, Broadcast Vendor M&A | Posted by Josh Stinehour
Feb 26 2016

Satellite service provider SES announced an acquisition agreement with RR Media (NASDAQ: RRM), a provider of media services to the broadcast and media industries.  SES intends to merge the operations of RR Media with its Platform Services group (“SES PS”) to create a larger global media solution provider.SES_Platform_Services_logo

During its 2015 earnings release, SES indicated the contract backlog of SES PS was over €300 million.  By comparison, the RR Media contract backlog as of September 30, 2015 was $262 million.

Wilfried Urner, Chief Executive Officer of SES PS, commented, “RR Media has successfully developed the capability to manage and deliver premium content effectively, helping its customers to reach a global audience over multiple satellite, cable TV, IPTV, online and mobile platforms. SES, as the largest global platform for video in terms of reach and channels, adds global scale and considerable insights from the successful development of SES PS in Europe.”

SES will pay all-cash for the acquisition of 100% of the shares of RR Media at a price of $13.291 (USD) per share. The consideration equates to an Enterprise Value of USD $242 (USD) million, which represents a 52% premium to RR Media’s share price on February 25, 2016.

During RR Media’s Q3 2015 earnings release Management had issued 2015 revenue guidance of $140 million to $143 million with adjusted EBITDA in the range of $17.6 million and $20.4 million.  Using the midpoint of this guidance, the implied valuation multiples are 1.7x 2015 Revenue and 12.7x 2015 adjusted EBITDA.  As part of SES’s earnings release for 2015, management indicated the acquisition is anticipated to be earnings accretive in the first year.

RR Media is expected to generate between $160 million and $170 million for the full year 2016. The growth estimates for 2016 are based on recognizing the full contribution of two acquisitions made by RR Media in 2015 for Satlink Communications and Eastern Space Systems (ESS).

The announced acquisition has already been approved by the Boards of Directors of both SES and RR Media.  It remains subject to regulatory approvals and the approval of the shareholders of RR Media.  The transaction is expected to close in Q2 or Q3 2016.

Commenting on the announcement, Avi Cohen, Chief Executive Officer of RR Media, said, “SES Platform Services is an important industry player with the capabilities to service strong upper tier clients. With the combined infrastructure and industry expertise, the integrated company will have the capability to deliver innovative solutions to top tier clients, emerging markets and global customers. RR Media’s growth strategy has focused on top tier client and increasing scale. This deal achieves both of these strategic goals.”

 

 

Related Content: 

SES Press Release: RR Media to Merge with SES Platform Services, Creating a World-Leading Global Media Solutions Provider

RR Media Press Release: RR Media to Merge with SES Platform Services

 

 

 

© Devoncroft Partners 2009 – 2016. All Rights Reserved.

 

 

Harmonic Announces Binding Offer to Acquire Thomson Video Networks for up to $90 Million

Analysis, Broadcast Vendor M&A | Posted by Joe Zaller
Dec 07 2015

Harmonic announced its intention to acquire Thomson Video Networks (“TVN”), a compression solution provider based in France. Harmonic_Logo

The purchase price of the acquisition is $75 million (USD) in cash, plus up to an additional $15 million in post-closing adjustments.  The transaction is expected to close in Q1 2016.

Thomson-VN_Logo

For 2014 TVN had sales of 71 million (EUR).  At prevailing 2014 exchange rates, this equates to approximately $95 million (USD).  Assuming an enterprise value of $90 million ($75 million at closing plus $15 million), the valuation is slightly more than 1x annual sales.

The “Binding Offer” is structured as a put option for TVN’s shareholders.  A put option gives the holder the right but not the obligation to sell shares to the option writer (in this instance Harmonic).  The “put” option is subject to the selling TVN shareholders’ 60-day consultation process with TVN’s employee works council in France.  Should the TVN shareholders execute the “put” option subsequent to the consultation process, then the parties would immediately execute a formal purchase and sale agreement.

Harmonic does maintain the right to terminate the transaction if the company is unable to raise adequate financing for the transaction (more below).

According to Harmonic’s regulatory filing there may be additional post-closing payments based on TVN’s 2015 revenue and TVN’s 2015 backlog that ships during the first half of 2016.  A review of the regulatory filing also highlights several closing conditions including the requirement of TVN to reacquire its patent portfolio from France Brevets (a third-party patent licensing firm).

TVN has changed ownership several times in the past five years.  TVN was divested by Technicolor in 2011 in a management-led buyout sponsored by Fonds de Consolidation & Développement des Entreprises (FDCE) for a reported price of around $8 million.  When Technicolor announced that it had sold TVN to FDCE in 2009, it said that the company had 525 employees and operated in 15 countries, and that its 2009 revenues was €61m.

Institutional investor Edmon de Rothschild Investment Partners then acquired a 49% stake in TVN in December 2014.  

 

Transaction Financing

In large part to finance the acquisition, Harmonic also announced today its intention to offer $125 million in convertible senior notes due in 2020.  At Harmonic’s election, the notes will be convertible into cash, shares of Harmonic’s common stock, or a combination.  Management expects to use $70 million of the offering to pay a portion of the costs of the TVN acquisition.  Management also intends to use up to $25 million from the offering to repurchase shares of its common stock.

Commenting on the choice of a convertible offering, Harmonic’s CFO Harold Cover highlighted the opportunity to lower the companies cost of capital and maintain an appropriate cash balance for company operations.

 

Transaction Rationale

Harmonic’s press release announcing the deal and subsequent conference call reiterated in several instances how the acquisition of TVN was an acceleration of Harmonic’s existing video strategy.  Harmonic’s CEO Patrick Harshman commented, “The combined product portfolios, R&D teams and global sales and service personnel would allow us to accelerate innovation for our customers while leveraging greater scale to drive operational efficiencies.”  A slide from conference call is also included below as a reference on several key points of the intended combination.

 

Harmonic - Thomson IR Slide

 

Harshman added further emphasis to the regional strength of TVN outside of the US – over 95% of TVN’s revenue profile is outside the US.  During the question and answer session, the Harmonic CEO cited a regional allocation of revenue for TVN of 50% EMEA, 25% APAC, and 25% Americas (with the majority coming from Latin America).  Management believes this regional profile is highly complementary, as there is less than 50% overlap in the respective company’s customer bases.

 

Consolidation Continues in Transcoding, Encoding, and Compression

The acquisition of TVN is the latest in a series of M&A transactions in the compression segment.  Ahead of the recent IBC Show Amazon announced its acquisition of Elemental Technologies and during the exhibition Ericsson announced its acquisition of Envivio.

Harmonic’s intention to buy Thomson Video Networks is the latest in a series of deals related to video compression, transcoding, and multi-screen video delivery.  As broadcasters and media companies scramble to deploy multi-screen services, transcoding is seen by many as a key technology.  As a result, transcoding has also attracted its fair share of financing and M&A activity.  Here’s a quick run-down of some of the recent transcoding deals and related-financial news:

 

 

 

 

 

 

  • In April 2014, Imagine Communications acquired Digital Rapids for an undisclosed amount

 

  • In April 2014, Dalet acquired Amberfin for an undisclosed amount

 

  • In January 2013, Amazon unveiled its “Amazon Elastic Transcoder.” Based on the company’s Amazon Web Services (AWS) cloud computing platform, the Elastic Transcoder the service provides “a highly scalable, easy to use and a cost-effective way for developers and businesses to transcode video files from their source format into versions that will playback on devices like smartphones, tablets and PCs.”

 

  • In August 2012 Brightcove bought Zencoder, a 2-year old start-up with $2m in revenue for $30m, and subsequently launched a cloud based transcoding service at IBC 2012

 

 

 

 

 

 

 

 

 

 

  • RGB Networks bought transcoding vendor Ripcode in 2010

 

 

Related Content:

Press Release: Harmonic Announces Binding Offer to Acquire Thomson Video Networks

Press Release: Thomson Video Networks Receives Harmonic Group’s Acquisition Offer

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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Broadcast Vendor M&A: Ericsson to Acquire Envivio in $125 Million All-Cash Deal

Analysis, Broadcast Vendor M&A, Broadcaster Financial Results, OTT Video | Posted by Joe Zaller
Sep 10 2015

Ericsson_Logo
Ericsson announced it has agreed to acquire Envivio for $4.10 per share, or approximately $125m.

The deal values Envivio, which had revenue and $41.5m for the year ended January 31, 2015, at more than more than double its closing price of $1.90 in yesterday’s trading.

The board of directors of Envivio has unanimously agreed to recommend that Envivio’s stockholders Envivio_Logotender their shares to Ericsson in the tender offer, and a group that collectively owns approximately 34 percent of Envivio’s outstanding common stock, have also expressed support for the deal.

Envivio provides software-based video encoding/transcoding, processing, packaging and ad insertion for broadcasters and pay TV operators.

Ericsson says the deal will “greatly enhance Ericsson’s software video encoding capabilities and its virtualized encoding concept, which enables abstraction of video processing functions from architectural and functional boundaries, enabling the flexibility to use both hardware and software based video compression, as well as any deployment architecture.”  Ericsson also said the deal extend its “leadership position in TV and media as a global end-to-end solution provider, strengthen [its] video compression position with combination of software and hardware encoding, [and] bring deep competence in software-defined and cloud-enabled architectures for video processing, enhancing Ericsson’s virtualized encoding approach.”

Ericsson’s acquisition of Envivio comes just a week after Amazon Web Services announced that it will be acquiring multi-screen technology provider Elemental Technologies.

Last year (at NAB 2014), Ericsson and Elemental jointly announced that Elemental’s video processing software had been “fully integrated into the Ericsson Virtualized Encoding solution.”  At that time, Dr. Giles Wilson, Head of TV Compression for Ericsson, said: “By expanding Ericsson Virtualized Encoding to also support Elemental software encoding, we are enabling TV service providers to efficiently address the growing complexity of multi-screen TV service delivery within a single solution. As providers strive to address consumer demand for TV Anywhere, we are focused on helping them make the right choices with their multi-screen video processing deployments.”

The combination of Elemental and Ericsson technologies were marketed by Ericsson as the SVP 4000 product family, which according to Ericsson’s website is “a server-based encoder [that] uses standard off-the-shelf GPUs to complement its powerful CPUs and hence provide the best encoding performance on a server-based platform.  In this regard it sits alongside the AVP 4000 system encoder, which offers the best encoding performance on a hardware-based platform.”

With Elemental now part of Amazon AWS, Ericsson moved quickly to find a new partner for multi-screen and virtualized encoding, and found a good one in Envivio.

Indeed, the Ericsson’s announcement of the Envivio acquisition specifically mentions that Envivio’s “pure software video processing is available on Intel-based appliances or IT blade servers.”

Interestingly, while the acquisition of Envivio gives Ericsson a good partner for multi-screen delivery, some of Envivio’s technology may overlap with Fabrix Systems, which Ericsson acquired in September 2014 for $95m. At the time of the Fabrix acquisition, Ericsson said Fabrix provides “cloud based scale out storage and computing platform focused on providing a simple, tightly integrated solution optimized for media storage, processing and delivery applications such as cloud DVR and video-on-demand (VOD) expansion.”

Time will tell whether Ericsson believes the technologies acquired from Envivio and Fabrix are complementary or overlapping.

Per Borgklint, Senior Vice President and Head of Business Unit Support Solutions at Ericsson, says: “Our consumer research clearly shows that viewers are demanding TV on their terms on any device, and expecting experiences that continually evolve. We are committed to offering our customers a clear path towards fully agile cloud agnostic platforms that delight TV consumers. I look forward to welcoming the market leader in pure software-defined video encoding, processing, and packaging into Ericsson. The combination will strengthen our encoding position with both custom silicon and pure software encoding, delivering performance and flexibility.”

 

Ericsson’s acquisition of Envivio is the latest in a series of deals related to online video and transcoding. As broadcasters and media companies scramble to deploy multi-screen services, transcoding is seen by many as a key technology.  As a result, transcoding has also attracted its fair share of financing and M&A activity.  Here’s a quick run-down of some of the recent transcoding deals and related-financial news:

 

 

 

 

 

  • In April 2014, Imagine Communications acquired Digital Rapids for an undisclosed amount

 

  • In April 2014, Dalet acquired Amberfin for an undisclosed amount

 

  • In January 2013, Amazon unveiled its “Amazon Elastic Transcoder.” Based on the company’s Amazon Web Services (AWS) cloud computing platform, the Elastic Transcoder the service provides “a highly scalable, easy to use and a cost-effective way for developers and businesses to transcode video files from their source format into versions that will playback on devices like smartphones, tablets and PCs.”

 

  • In August 2012 Brightcove bought Zencoder, a 2-year old start-up with $2m in revenue for $30m, and subsequently launched a cloud based transcoding service at IBC 2012

 

 

 

 

 

 

 

 

 

 

  • RGB Networks bought transcoding vendor Ripcode in 2010

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Related Content:

Press Release: Ericsson announces agreement to acquire Envivio

Amazon Web Services to Acquire Elemental Technologies for a Reported $500 Million 

Press Release: Elemental Announces Full Integration with Virtualized Encoding Solution

Ericsson Virtualized Encoding (EVE)

Ericsson SVP 4000 Product Family

Press Release: Cloud video transformation accelerated through Ericsson acquisition of Fabrix Systems

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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Broadcast Vendor M&A: Net Insight Acquires ScheduALL in $14 Million All-Cash Deal

Analysis, Annual Results, broadcast industry trends, broadcast technology market research, Broadcast Vendor M&A | Posted by Joe Zaller
Sep 04 2015

Net Insight announced it has acquired resource scheduling software provider ScheduALL in a $14m all-cash deal.logo-net-insight

The company says the deal will strengthen Net Insight’s “market position in media service and workflow orchestration.” ScheduAll_Logo

Media and workflow orchestration has become an increasingly important (and crowded) area over the past two years, with multiple vendors announcing new initiatives in this area.

This is Net Insight’s first acquisition in more than a decade.  At current exchange rates, the acquisition will consume approximately 40% of Net Insight’s cash balance as of the end of Q2 2015.

For the 2014 financial year, ScheduALL had revenue of $10.6m, approximately 60% of which was recurring. ScheduALL made a profit of $700,000 in 2014.

The implied multiples of the transaction are 1.3x 2014 revenue and 20x 2014 net profit.  In comparison, Net Insight trades in the public markets (as of 9/2) at 1.6x revenue and 25x earnings.  On both measures, the acquisition is accretive.

To put the acquisition’s impact in proper context, consider Net Insight has grown revenues since 2010 by approximately $10 million USD, which is roughly the acquired revenue from ScheduALL.

“This is a perfect match for Net Insight,” said company CEO Fredrik Tumegard. “We are not only executing on our strategy, we are also taking a giant leap towards our vision of creating a unified and global media market place for both service providers and media companies.”

Half of ScheduALL’s revenue in 2014 was from North America.  This will provide greater exposure to the North American market for Net Insight, which generated 44% of its revenue from the Americas (including South America) in fiscal 2014.

Adding to the financial benefits are the straightforward cost synergies from combining duplicative sales and marketing activities including trade shows.  No guidance was provided in the press release on the potential for cost synergies.

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Related Content:

Press Release:  Net Insight Acquires US Software Company ScheduAll

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© Devoncroft Partners 2009-2015. All Rights Reserved.

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Amazon Web Services to Acquire Elemental Technologies for a Reported $500 Million

broadcast technology market research, Broadcast technology vendor financials, Broadcast Vendor M&A | Posted by Joe Zaller
Sep 03 2015

Amazon Web Services, Inc. (AWS) announced it has reached an agreement to acquire Elemental Technologies.

Elemental_Logo

According to a statement from AWS, the deal brings together Elemental’s leading video solutions with the AWS Cloud platform to provide media and entertainment companies with a range of integrated solutions to efficiently and economically scale video infrastructures as the media industry increasingly moves to internet based delivery.

Terms of the acquisition were not disclosed, but several outlets are reporting that the value of the deal was approximately $500 million.Amazon_AWS_Logo

It the rumored $500 million acquisition price is true, it represents a strong valuation for Elemental. For the full year 2014, Elemental had revenue of approximately Elemental had revenue of $49.2 million, according to INC Magazine’s listing of the fastest growing private companies in the United States

In December 2014, Elemental closed a $15m series D funding round, led by led by Australian telco giant, Telstra, who in August 2014 acquired online video platform provider Ooyala for $360m.

According to Crunchbase, Elemental raised a total of roughly $44 million from investors over the years, including venture firms General Catalyst Partners, Voyager Capital, Steamboat Ventures, and Norwest Venture Partners. Others of its investors include the Australian telco Telstra, the European pay TV giant Sky, and the angel investor groups Oregon Angel Fund and Alliance of Angels.

blackman, elemental

Speaking on a panel of industry executives at the 2015 NAB Show, Elemental founder and CEO Sam Blackman said the company had more than $50 million in revenue, had grown its top-line revenue by more than 55% over the past year, and that he would “be disappointed if we didn’t do that again this year.”

Elemental will continue to operate its business under its existing brand, delivering the full range of solutions for pay TV operators, content programmers, broadcasters, governments, and enterprise customers. Elemental will also expand the integration of its offerings with AWS, and through close collaboration with AWS, accelerate the innovation of next-generation services that feature a range of solutions for customers leveraging on-premises assets, hybrid architectures, and cloud.

In a blog post, Blackman said I am thrilled to announce today that Elemental is joining forces with Amazon to accelerate the development and adoption of our software-defined video platform. Elemental’s top core value of Integrity is similar to Amazon’s Leadership Principal ‘Earn Trust of Others.’ Amazon ups the ante on Elemental’s core value of ‘Customer Centrism’ with their ‘Customer Obsession.’ And Elemental’s third core value, ‘Innovation,’ is matched by Amazon’s ‘Invent and Simplify.’ This alignment around the fundamental, intrinsic cultural values shared by our teams ensures that we will do great things together.

Elemental will continue to operate its business under its existing brand, delivering the full range of solutions for pay TV operators, content programmers, broadcasters, governments, and enterprise customers. Elemental will also expand the integration of its offerings with AWS, and through close collaboration with AWS, accelerate the innovation of next-generation services that feature a range of solutions for customers leveraging on-premises assets, hybrid architectures, and cloud.

“The media and entertainment industry is at a unique inflection point, and as a part of Amazon, we will be in an even stronger position to help our customers delight their viewers globally,” said Sam Blackman, co-founder and CEO of Elemental. “We’re thrilled to have Amazon supporting our growth and ongoing commitment to our customers’ success.”

“We’re thrilled to have Amazon supporting our growth and ongoing commitment to our customers’ success.”

“Elemental shares Amazon’s passion for invention and putting the customer first,” said Andy Jassy, Senior Vice President of Amazon Web Services. “Together, we’ll collaborate on deeper technology integrations and new infrastructure offerings so that media and entertainment companies can evolve their hybrid and cloud models as they continue to innovate their services for viewers.”

 

Today’s Elemental announcement is the latest in a series of deals related to online video and transcoding. As broadcasters and media companies scramble to deploy multi-screen services, transcoding is seen by many as a key technology.  As a result, transcoding has also attracted its fair share of financing and M&A activity.  Here’s a quick run-down of some of the recent transcoding deals and related-financial news:

 

 

 

  • In April 2014, Imagine Communications acquired Digital Rapids for an undisclosed amount

 

  • In April 2014, Dalet acquired Amberfin for an undisclosed amount

 

  • In January 2013, Amazon unveiled its “Amazon Elastic Transcoder.” Based on the company’s Amazon Web Services (AWS) cloud computing platform, the Elastic Transcoder the service provides “a highly scalable, easy to use and a cost-effective way for developers and businesses to transcode video files from their source format into versions that will playback on devices like smartphones, tablets and PCs.”

 

  • In August 2012 Brightcove bought Zencoder, a 2-year old start-up with $2m in revenue for $30m, and subsequently launched a cloud based transcoding service at IBC 2012

 

 

 

 

 

 

 

 

 

 

  • RGB Networks bought transcoding vendor Ripcode in 2010

 

 

Related Content:

Press Release: Amazon Web Services to Acquire Elemental

TechCrunch Amazon Acquires Elemental Technologies for a Reported $500 Million, In Cash

Elemental Blog: Sam Blackman – Building Earth’s Biggest Video Infrastructure!

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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ChyronHego Taken Private by PE Firm, Delisted from NASDAQ

Annual Results, Broadcast technology vendor financials, Broadcast Vendor M&A, Quarterly Results, SEC Filings | Posted by Joe Zaller
Mar 09 2015

ChyronHego LogoVector Capital has completed the previously announced $120m deal to acquire ChyronHego and take it private.

Under the terms of the deal, ChyronHego stockholders will receive $2.82 per share in cash, and ChyronHego common stock has ceased trading on the NASDAQ Stock Exchange.

According the definitive proxy statement, the purchase of ChyronHego will be funded by a combination of equity and debt financing.

Equity financing will be provided by Vector Capital and its affiliates, who have committed to pay approximately $49.3m towards the acquisition, and related expenses.

Debt financing is being provided by Silicon Valley Bank (SVB) and Apollo Investment Corporation (Apollo) in the form of a $50m senior secured five-year term loan, which is expected have interest of “either (i) the Eurodollar Base Rate plus 5.625% (subject to a 1.0% floor with respect to the Eurodollar Base Rate), or (ii) at the Adjusted Base Rate (defined as the highest of (w) 2.75% of (x) the Wall Street Journal Prime Rate and (y) the Federal Funds Rate plus 0.50%) plus 3.875%.”

Separately, SVB and Apollo have also providing a $7m senior secured revolving credit facility that has the same terms as the senior five-year term loan. ChyronHego will use the revolving credit facility for working capital and capital expenditures and other general corporate purposes.

In its last quarter as a public company (Q3 2014), ChyronHego posted a net loss of $2.6m on revenue of $14m.

During the first nine months of 2014, ChryronHego posted a net loss of $2.8m on revenue of $43.3m.

For the trailing twelve months (TTM) ended September 30, 2014, ChyronHego had revenue of $58m, comprised of $27.2m of product revenue and $30.8m of service revenue.

In a securities filing, ChyronHego said it ended 2014 with approximately $5.4m in cash and equivalents; and projected that its revenue for the full year 2014 would be $59m.

“We are delighted to be working with Vector Capital,” said Johan Apel, President and Chief Executive at ChyronHego. “As a private company, ChyronHego will be ideally positioned to reinforce the company’s leadership in news, sports and live production solutions. The Vector team has a strong track record of success in acquiring and operating innovative technology companies, and our partnership with them will enable us to reach new levels of scale, technological capabilities and customer service.”

David Fishman, Managing Director at Vector Capital, who will join ChyronHego’s Board of Directors, said: “We believe that as a private company with Vector’s financial support ChyronHego will be well positioned to capitalize on the significant opportunities in broadcast graphics creation, play-out and real time data visualization. Over time, we are confident the company will be well positioned to capitalize on the exciting trends in the sports, news and live television markets.”

“We welcome ChyronHego to the Vector family,” said Nick Lukens, Vice President at Vector. “We are very excited to roll up our sleeves and get to work with the talented team at ChyronHego. Through our partnership with management, we are committed to strengthening and expanding ChyronHego’s market leading product and service capabilities.”

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Related Content:

Press Release: Vector Capital Completes Acquisition of ChyronHego

Certificate of Merger

ChyronHego Makes Revealing Disclosures About “Going-Private” Transaction

Broadcast Vendor M&A: ChyronHego to be Taken Private by Vector Capital in $114 Million Deal

ChyronHego 8-K: Additional Disclosures Regarding Vector Transactions

ChyronHego: Definitive Proxy Statement on Vector Take-Private Transaction

ChyronHego Investor Presentation March 2014

ChyronHego Investor FAQ and Introduction to Vector Capital

Agreement and Plan of Merger: ChyronHego Corporation, Vector CH Holdings (Cayman), L.P., And CH Merger Sub, Inc.

ChyronHego SEC Filing: Entry into a Material Definitive Agreement with Vector Capital

ChyronHego One Year Stock Price Chart

Broadcast Vendor M&A: Vizrt to be Taken Private in $374 Million All-Cash Deal

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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Thorsteinson Replaces Cross as CEO of Quantel and Snell

Analysis, Broadcast technology vendor financials, Broadcast Vendor M&A, Broadcaster Financial Results | Posted by Joe Zaller
Mar 04 2015

Quantel and Snell announced that Tim Thorsteinson has replaced Ray Cross as CEO, effective immediately.news_Tim_Thorsteinson

According to the company, Thorsteinson “is the ideal individual to lead the next stage in the development of the combined Quantel and Snell.”

Cross, who had been CEO of both Quantel and Snell since March 2014, when it was announced that Quantel had acquired fellow UK-based broadcast technology vendor Snell, a deal that had been long-rumored in the industry, since the two companies already had a common parent, Lloyds Development Capital (LDC), the investment arm of Lloyds Bank.

Previously, Cross had been CEO of Quantel since December 2005.

At the time of the Quantel-Snell deal, the company said in a statement that the combined entity had revenue of more than $170 million and office in 16 locations around the globe, making it one of the larger vendors in the broadcast industry.  The company has not provided an update on its performance since that time.

It will be interesting to see what moves Thorsteinson, a longstanding broadcast industry executive, will make as CEO of Snell and Quantel, companies he has competed against in previous roles.

Thorsteinson is a well-known figure in the broadcast industry having headed-up several of the industry’s largest technology vendors over the past 15 years.

In January 2013, Thorsteinson was named CEO of Grass Valley, replacing Alain Andreoli, who had been appointed by private equity firm Francisco Partners following their 2010 acquisition of Grass Valley from Technicolor.

Just over a year later, Thorsteinson oversaw the $220m sale of Grass Valley to Belden Corporation, who combined it with Miranda, keeping the Grass Valley moniker for the enlarged entity.

Interestingly, Thorsteinson was also involved in the sale of Miranda to Belden.  In April 2012, he appointed a director of Miranda Technologies during the time that activist investor JEC Capital was agitating for a sale of that business.  Three months after Thorsteinson became a director of the company, Belden Corporation acquired Miranda for an enterprise value of $356m.

Thorsteinson was the President of Harris Corporation’s Broadcast Communications Division from 2006-2010.  He was appointed to this role following the $460m purchase by Harris of Leitch Technology Corporation, where Thorsteinson had been CEO since November 2003.

Prior to Leitch, Thorsteinson was CEO of Grass Valley Group, and oversaw the December 2001 sale of Grass Valley Group to Thomson Multimedia for $172m.

“We are delighted to have Tim Thorsteinson join Quantel to continue the company’s transformation. Tim has a proven track record of value creation, and his knowledge and experience are a great fit to grow the combined Quantel and Snell business into a major force in the rapidly changing broadcast industry,” said Chris Hurley, Managing Director Lloyds Development Capital and Quantel Board Director. “I would also like to thank Ray for all his hard work and achievements at Quantel over the past 10 years.”

“I’m very excited to be joining Quantel,” said Thorsteinson. “It is one of the larger independent businesses in our industry, with world class products and a rich history of innovation. I want to build on that tradition to create an organization 100% focused on helping our customers prosper in the media technology world.”

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Related Content:

Press Release: Tim Thorsteinson becomes Quantel CEO

Broadcast Vendor M&A: Quantel Acquires Snell

Press Release: Quantel acquires Snell to create new force in media technology

Quantel – Snell FAQ

Belden Makes it Official – Combination of Grass Valley and Miranda to be Called Grass Valley

Broadcast Vendor M&A: Belden Completes Acquisition of Grass Valley, Will Invest $25 Million in Integration of Combined Business

Broadcast Vendor M&A: Belden Buys Grass Valley for $220 Million

Belden Closes Deal to Acquire Miranda

Thorsteinson Appointed to Miranda’s Board of Directors in Otherwise Uneventful AGM

Miranda Nominates Tim Thorsteinson as Director

Activist Shareholder Drama Continues at Miranda Technologies

Technicolor Receives a Binding Offer from Francisco Partners for Grass Valley Broadcast Business

Press Release: Tim Thorsteinson Named President of Harris Corporation’s Broadcast Communications Division

Press Release: Harris Corporation Completes Acquisition of Leitch Technology

WSJ Article: Thomson Multimedia to Buy Grass Valley for $172 Million

Broadcast Vendor M&A: Belden Buys Grass Valley for $220 Million

Belden’s Acquisition of Miranda to Close on or Before July 27, 2012

TVNewsCheck Article (9-29-2011): Tech One-on-One With Simon Derry — Snell Aims To Master the U.S. Market

Advent Venture and LDC close £72m broadcasting merger

Advent Venture Partners and LDC Complete Their Portfolios Merger – March 9, 2009

Video: Pro-Bel and Snell & Wilcox CEOs Discuss Merger (2009)

Press Release (11-6-2003): Chyron Sells Pro-Bel to LDC

Broadcast Magazine (2002): Snell Secures £22m from Advent

Press Release (2002) Advent Venture Partners invests GBP13m in Snell & Wilcox

Variety Article (7-14-2000): Carlton sells tech arm Quantel to LDC for £51 million 

 

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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NeuLion Revenue Increases 17 Percent in Q4 2014

Annual Results, Broadcaster Financial Results | Posted by Joe Zaller
Mar 04 2015

NeuLion,_Inc_-729822400065

Online video platform provider NeuLion reported that its revenue for the fourth quarter of 2014 was $16.5m, an increase of 17% versus the same period a year ago, and up 32% versus the previous quarter.

Consolidated net income for the quarter was $1.6m, or $0.01 per basic and diluted share, an increase of up from $1.1m last year, and $0.2m last quarter.

Operating income for the quarter was $1.8m, up from $1.1m last year, and $0.2m last quarter

Company CEO Kanaan Jemili said the NeiLion’s improved performance for the quarter reflects the company’s “continued gains in volume and usage from new and existing customers and demonstrating the earnings power of our business model.”

 

On a segment basis:

  • Revenue from Pro Sports was $7.9m, an increase of 18% versus the same period a year ago, and an increase of 52% versus the previous quarter. The company attributed the year-over-year increase in pro sports revenue to growth in variable subscription fees.
  • College Sports revenue was $3.6m, down 8% versus the same period a year ago, up 16.1% versus the previous quarter. The company attributed the year-over-year decline college sports revenue to the loss of the company’s ability to sell subscriptions for certain colleges, as colleges move to consolidate into conferences and sports networks
  • Revenue from TV Everywhere was $5m, up 43% versus the same period a year ago, and up 47.1% versus the previous quarter.  The company said TV Everywhere revenue increased because of increases in monthly fixed fees and variable usage fees.

 

Expenses during the quarter were up across the board.  Selling, general and administrative expenses, including stock-based compensation, were $8m, an increase of 27%, versus the same period a year ago. Including in selling, general and administrative costs were approximately $0.8 million of acquisition-related expenses and $0.2 million in costs associated with compliance with Section 404 of the Sarbanes-Oxley Act.

Research and development expenses in the fourth quarter were $2.1m, an increase of 5%, compared to the fourth quarter of 2013.

 

Full year 2014 Results

NeuLion’s revenue for the full year 2014 was $55.5m, up 18% versus the previous year.

Consolidated net income for the full year 2014 was $3.6m, or $0.01 per basic and diluted share, compared to a net loss of $2.3m in 2013.

Full year 2014 operating income for the quarter was $3.5m, versus an operating loss of $1.6m in 2013.

 

NeuLion CEO Kanaan Jemili said the company’s improved performance for the quarter reflects the company’s “continued gains in volume and usage from new and existing customers and demonstrating the earnings power of our business model.”

“With the acquisition of DivX, we have entered 2015 excited about our expanded set of opportunities globally to continue scaling the business and to seize leadership from both a technology platform and consumer experience perspective in the fast-growing online video market,” added Dr. Jemili. “We are intently focused on enlarging our customer base of both sports and entertainment content owners and consumer electronics manufacturers while continuing to expand relationships with our established customers. As adoption of ultra HD/4K video and Over-the-Top services accelerates, our end-to-end solution offerings, which enable digital content management, distribution and monetization, perfectly position NeuLion to deliver high quality on-demand and live interactive digital content anywhere, on any device,” concluded Dr. Jemili.

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Related Content:

Press Release: NeuLion Reports 22% Year-Over-Year Increase in Third Quarter Revenue to $12.2 Million

NeuLion Completes Acquisition of DivX

Broadcast Vendor M&A: Rovi Sells DivX and MainConcept to Parallax Capital and StepStone Group for $75 Million

Rovi – Parallax Capital: DivX Purchase Agreement

Press Release: Rovi Announces Sale of DivX and MainConcept Businesses

Press Release: Parallax Capital Partners and StepStone Group to Acquire DivX

Rovi to buy Sonic for $720 million

Sonic Solutions to buy DivX in $323M bid to become digital media leader

Sonic Solutions Integrates Newly Acquired MainConcept, Forms New Pro Technology Division

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© Devoncroft Partners 2009 – 2015. All Rights Reserved.

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