WildBrain is selling its majority stake in its TV channels in a deal valued at $40 million.
The company announced Wednesday that independent, Halifax-based children’s studio IoM Media Ventures – led by former DHX Media CEO Dana Landry – will acquire 66 2/3% of its television broadcast business, including Family Channel, Family Jr., WildBrainTV and Télémagino, pending CRTC approval.
Under terms of the agreement, WildBrain says it expects to receive more than $40 million over the next four years from the transaction. The deal is expected to close in three to six months, with WildBrain intending to use the proceeds to pay down debt.
WildBrain will retain 33 1/3% ownership in the channels, continuing its involvement in the way of up-front and deferred purchase consideration, minority participation distributions, content licensing and other fees. Selling its majority stake, means WildBrain will no longer be subject to certain restrictions under the Broadcasting Act related to non-Canadian ownership, which will allow it to remove its variable voting share structure currently applicable to non-Canadian shareholders.
“As we continue to strategically focus on driving high-growth areas for key global franchises and partnerships, this transaction is a critical step forward in simplifying our business,” said Josh Scherba, President and CEO of WildBrain, in a company announcement. “Financially, we believe it strikes a balance between economic participation for WildBrain while benefiting our leverage profile over the long term. We’re confident that, with IoM, the Channels will pass to a strong independent Canadian studio. As a partner with IoM, we look forward to working with them to uphold the prominent legacy of these Channels with a dedication to delivering best-in-class content for Canadian families.”
“We’re thrilled to deepen our partnership with WildBrain, and we look forward to integrating these Channels and resources into our ecosystem after close of the transaction to accelerate growth as we look to invest boldly in content and expand our footprint in the kids’ and family entertainment space,” added Dana Landry, President and CEO of IoM Media Ventures.
WildBrain says at this time, there are no planned management or workforce changes planned.
IoM partnered with private investment firm, MEP Capital, to provide financial backing for the transaction.
