24 May 12
Strategic acquisition and distribution partnership for independent films formed in January between Cinedigm and New Video. Board Member Susan Margolin becomes Co-President of new entertainment group focused on theatrical and digital distribution of Indie Docs.
CINEDIGM ACQUIRES LEADING ENTERTAINMENT DISTRIBUTOR NEW VIDEO®
Acquisition Establishes Cinedigm As A Full Service Entertainment Studio Providing Digital Theatrical and Complete Platform Distribution For Independent Films And Specialty Content
Cinedigm Digital Cinema Corp. (NASDAQ: CIDM) , the global leader in digital cinema, announced on April 20th it acquired leading entertainment distributor New Video Group, Inc., the largest worldwide digital aggregator of independent content and leading distributor of quality entertainment. Cinedigm’s acquisition of New Video creates a new full service end-to-end digital releasing studio, acquiring and distributing independent films and specialty content both theatrically and through digital, mobile and home media platforms.
This acquisition builds upon the strategic acquisition and distribution partnership for independent films formed in January between Cinedigm and New Video. Already, the joint venture has acquired two award-winning films at Sundance and SXSW, The Invisible War and Citadel, which are planned for release in June and September respectively and also announced the acquisition of a third highly regarded independent film, In Our Nature.
“Cinedigm is now a fully integrated distributor of independent films and specialty content,” said Cinedigm Chairman and CEO Chris McGurk. “Over the past year, we have analyzed many companies in the digital distribution space for home and mobile entertainment and determined that New Video is the best partner for us. New Video’s highly regarded management team, led by Susan Margolin and Steve Savage, is entrepreneurial, forward-looking and innovative. Their tremendous success in the ever-evolving digital space, combined with their expertise in content acquisition, sales and marketing and distribution of traditional packaged goods, puts them clearly ahead of the pack. Our new distribution capabilities will provide a unique, one stop end-to-end digital distribution solution for independent content providers and financiers.”
Cinedigm has agreed to acquire New Video for $14 million in upfront consideration, plus additional earn out potential of up to $6 million over three years tied to the future financial results of the Cinedigm Entertainment Group. The upfront consideration will be paid with $10 million of cash from Cinedigm’s balance sheet and $4 million of Cinedigm stock issued at the trailing 10 day volume weighted average price.
“This combination creates a very powerful distribution machine at a time when the industry is at the crossroads of profound change and real strategic opportunity,” said Steve Savage, Co-President of New Video. “Cinedigm is the perfect partner for expanding the market for feature film and entertainment content, while exploiting every opportunity for innovation in VOD, digital and mobile distribution.
"Filmmakers and content creators will greatly benefit from our leading-edge digital distribution strategies," added Susan Margolin, Co-President of New Video. “Steve and I and the entire New Video team look forward to expanding on what has already proven to be a fruitful and promising partnership with Cinedigm.”
Effective immediately Savage and Margolin became co-Presidents of Cinedigm’s Entertainment Group, which includes New Video as well as the pre-existing theatrical marketing and booking services at Cinedigm, and will report directly to McGurk. Aimee Connolly, New Video’s Chief Operating Officer, assumes the same position for the Cinedigm Entertainment Group.
Headquartered in New York City, New Video was founded in 1991 to acquire and distribute alternative and independent film content using both fee-based and royalty-based models. New Video has since acquired licenses for more than 4,000 feature films and 6,000 television episodes. New Video has key relationships with platform partners including Netflix, iTunes, Amazon, Vudu, Hulu, Xbox and PlayStation, as well as leading brands A+E, Scholastic, Tribeca Film, ZDF, Henson, Beyond International and ITV. The company has delivered strong results in DVD/Blu-ray, returning over $1.5 billion to content owners since its founding more than 20 years ago.