Ballantyne Strong Announces Sale of Convergent Media Systems for $23 Million
February 02 2021 - 8:45AM
Ballantyne Strong, Inc. (NYSE American: BTN) (“Ballantyne Strong”
or the “Company”) today announced that it has completed the sale of
its wholly-owned subsidiary Convergent Media Systems, LLC
(“Convergent”) for a total enterprise value of approximately $23.2
million.
Mark Roberson, Chief Executive Officer of
Ballantyne Strong, commented, “Convergent represents a successful
turnround, transitioning a business that was generating significant
losses to a profitable operation and a marketable asset. After
monetizing the value created at Convergent, the Company will be
better positioned to expand its other operating businesses and
strategic investment portfolio. As a result of the transaction, we
expect to recognize an income statement gain of approximately $15
million or $1.00 per share in the first quarter of 2021.
“We are excited about our continuing operating
businesses and the value in our investment portfolio. Strong
Entertainment is strengthening its industry-leading position, with
new multi-year service and supply agreements with two of the
leading operators in the cinema industry. Firefly is continuing its
rollout of digital advertising on taxis and rideshare vehicles, FG
Financial recently completed its investment in the sponsor of FG
New America (NYSE: FGNA) and entered into its first reinsurance
contract, and GreenFirst Forest Products has performed
exceptionally well following its leadership additions and strategic
investments in the Canadian timber business.
“Moving forward, we are encouraged by the
opportunities we’re seeing in the marketplace and believe we are
well positioned to create stockholder value.”
More information about the transaction will be
available in a Current Report on Form 8-K, which will be filed with
the Securities and Exchange Commission within four business days of
the closing of the transaction.
About Ballantyne Strong
Ballantyne Strong, Inc.
(www.ballantynestrong.com) is a
diversified holding company with operations and investments across
a broad range of industries. The Company’s Strong Entertainment
segment includes the largest premium screen supplier in North
America and also provides technical support services and other
related products and services to the cinema exhibition industry,
theme parks and other entertainment-related markets. Ballantyne
Strong holds a $13 million preferred investment along with Google
Ventures in privately held Firefly Systems, Inc., which is rolling
out a digital mobile advertising network on rideshare and taxi
fleets. Finally, the Company holds a 30% ownership position in
GreenFirst Forest Products Inc. (TSX: GFP) which has recently
completed an investment in a sawmill and related assets and a 21%
ownership position in FG Financial Group, Inc. (Nasdaq: FGF) which
is implementing business plans to operate as a diversified
insurance, reinsurance and investment management holding
company.
Forward-Looking Statements
Except for the historical information in this
press release, it includes forward-looking statements relating to
the business of the Company that can be identified by the use of
forward-looking terminology such as “believes,” “expects,”
“anticipates,” “will,” “may,” or similar expressions. Such
forward-looking statements involve a number of known and unknown
risks and uncertainties, including but not limited to those
discussed in the “Risk Factors” section contained in Item 1A in our
Annual Report on Form 10-K for the year ended December 31, 2019,
Part II, Item 1A of the Company’s Quarterly Report on Form 10-Q for
the quarterly period ended September 30, 2020 and the Company’s
subsequent filings with the SEC, and the following risks and
uncertainties: the negative impact that the COVID-19 pandemic has
already had, and may continue to have, on the Company’s business
and financial condition, the Company’s ability to maintain and
expand its revenue streams to compensate for the lower demand for
the Company’s digital cinema products and installation services,
potential interruptions of supplier relationships or higher prices
charged by suppliers, the Company’s ability to successfully compete
and introduce enhancements and new features that achieve market
acceptance and that keep pace with technological developments, the
Company’s ability to successfully execute its capital allocation
strategy, the Company’s ability to maintain its brand and
reputation and retain or replace its significant customers,
challenges associated with the Company’s long sales cycles, the
impact of a challenging global economic environment or a downturn
in the markets (such as the current economic disruption and market
volatility generated by the ongoing COVID-19 pandemic), economic
and political risks of selling products in foreign countries
(including tariffs), risks of non-compliance with U.S. and foreign
laws and regulations, potential sales tax collections and claims
for uncollected amounts, cybersecurity risks and risks of damage
and interruptions of information technology systems, the Company’s
ability to retain key members of management and successfully
integrate new executives, the Company’s ability to complete
acquisitions, strategic investments, entry into new lines of
business, divestitures, mergers or other transactions on acceptable
terms, or at all, the Company’s ability to utilize or assert its
intellectual property rights, the impact of natural disasters and
other catastrophic events (such as the ongoing COVID-19 pandemic),
the adequacy of insurance, the impact of having a controlling
stockholder and vulnerability to fluctuation in the Company’s stock
price. Given the risks and uncertainties, readers should not place
undue reliance on any forward-looking statement and should
recognize that the statements are predictions of future results
which may not occur as anticipated. Many of the risks listed above
have been, and may further be, exacerbated by the COVID-19
pandemic, its impact on the cinema and entertainment industry, and
the worsening economic environment. Actual results could differ
materially from those anticipated in the forward-looking statements
and from historical results, due to the risks and uncertainties
described herein, as well as others not now anticipated. New risk
factors emerge from time to time and it is not possible for
management to predict all such risk factors, nor can it assess the
impact of all such factors on the Company’s business or the extent
to which any factor, or combination of factors, may cause actual
results to differ materially from those contained in any
forward-looking statements. Except where required by law, the
Company assumes no obligation to update, withdraw or revise any
forward-looking statements to reflect actual results or changes in
factors or assumptions affecting such forward-looking
statements.
For Investor Relations
Inquiries:
Mark Roberson |
John Nesbett / Jennifer
Belodeau |
Ballantyne Strong - Chief
Executive Officer |
IMS Investor Relations |
704-994-8279 |
203-972-9200 |
IR@btn-inc.com |
jnesbett@institutionalms.com |
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