Ascent Media Corp. has reached a definitive agreement to sell its global content distribution unit to Encompass Digital Media.
The acquisition, which will create a worldwide provider of media services to cable channels, broadcasters, media companies and institutions, is valued at some $120 million, $113 million in cash and the assumption of some $7 million in debt, according to Encompass. The transaction is expected to be finalized in first quarter 2011.
John Malone's Liberty Media Corp. owns a majority of Ascent Media Corp, which late last month entered into an agreement for its Ascent Media Group to divest its Creative and Media Services outfits to Deluxe Entertainment Services Group for $68 million in cash and an undisclosed amount of debt. At the time, Ascent Media Corp. said it was pursuing strategic alternatives for its content distribution and systems integration businesses.
The transaction will greatly expand Encompass' scale and geographic footprint by combining its core operations in Los Angeles and Atlanta with Ascent's broadcast facilities in the New York metro area, Minnesota and Burbank, Singapore and London.
Following the completion of the transaction, Encompass will employ 950 workers and operate a network of broadcast facilities worldwide with integrated media solutions encompassing network origination, central casting for TV stations, disaster recovery, satellite and fiber transmissions, satellite uplink trucks and digital media services.
The combined company client base will include: A&E Networks/Lifetime, Sony, NBC Universal, CBS, Disney/ABC, BBC Worldwide, U.S. Department of Defense, MTV, ESPN, NHL, Discovery Networks, DirecTV Regional Sports Networks, NFL Network, YES Network, Scripps, Hallmark, Channel Five and TV Guide. Ascent's video switch business will also allow Encompass to expand its relationships with key customers such as CNN, CNBC, Bloomberg, Thomson Reuters, and the United Nations.
"Acquiring Ascent's content distribution business positions Encompass as a leading provider in outsourced media solutions by significantly enhancing our ability to meet the needs of broadcasters and media companies looking to benefit from the latest technology and rationalize costs with a highly credible global partner," said Simon Bax, Chief Executive Officer of Encompass.
Financing for the transaction is being provided by Macquarie Capital and Tennenbaum Capital Partners, LLC; Macquarie is serving as the exclusive financial advisor to Encompass.
The smarter way to stay on top of the multichannel video marketplace. Sign up below.
Thank you for signing up to Multichannel News. You will receive a verification email shortly.
There was a problem. Please refresh the page and try again.