Acquisition of One of the World’s Largest
AVOD Channel Networks Increases Cinedigm’s OTT
Footprint to over 7.6 Million Monthly Active Users and 67 million
app installs
Cinedigm Corp (NASDAQ: CIDM) announced that it has entered into a
definitive agreement to acquire Future Today, Inc, a market-leading
OTT platform and one of the largest AVOD channel networks in the
world, for $45 million in cash and $15 million in Cinedigm common
stock. The acquisition increases Cinedigm’s OTT footprint to over
7.6 million Monthly Active Users and 67 million total app installs
and is expected to be immediately accretive. Future Today
generates positive net income and healthy cash flow, with revenues
increasing by almost 150% in calendar year 2018 to an estimated
$23.9 million in full year revenues.
Future Today Inc owns and operates more than 700
content channels with more than 60 million app installs, and
manages more than 200,000 film, television and digital content
assets that currently receive more than 85 million video views per
month in a variety of categories including entertainment, movies,
food & lifestyle, animation, and kids.
Future Today has several proprietary brands
which have become market leaders in the ad-supported marketplace,
headlined by flagship channels Fawesome.tv focused on general
entertainment movies & television shows, and HappyKids.tv, the
#1 free kid’s channel providing age-specific edutainment in the
connected TV market.
Future Today’s cloud-based technology and
ad-based monetization platform manages OTT services for more than
350 content owners, producers, distributors and major media
companies helping them launch and monetize complex Connected TV
channels across devices in a matter of days. Key partners such as
Filmrise, WatchFreeFlix, and several others have experienced major
growth in watch time and user engagement since moving to the Future
Today OTT platform.
Future Today has a high ROI, data-driven
original programming strategy, which is focused currently on the
animation, live action and food categories. The company has
produced and owns over 3,500 original videos, which generate nearly
25% of Future Today’s total video views.
Alok Ranjan and Vikrant Mathur, co-founders of
Future Today, will continue to lead and operate Future Today as
Co-Presidents and will enter into long-term employment agreements
with Cinedigm upon deal closing.
Strategic HighlightsThe
acquisition of Future Today Inc. will dramatically increase
Cinedigm’s reach across the leading platforms in the OTT streaming
marketplace and will enhance the Company’s key capabilities for
distributing and monetizing content. The addition of Future Today’s
properties to the Cinedigm roster will solidify the Company’s
position as the world’s largest library of premium AVOD content.
The benefits of this transaction include:
PROVIDES CINEDIGM WITH A FULLY
SCALED VIDEO AD PLATFORM
- Future Today’s 5.2 million monthly active users, combined with
Cinedigm’s 2.4 million, will create a combined and growing targeted
consumer footprint of over 7.6 million Monthly Active Users,
predominantly on connected devices and televisions
- Generates billions of high-value, highly addressable connected
TV ad impressions annually, accelerating the ability to drive
direct advertising sales with brands and agencies
- Enables additional scaled distribution and monetization
opportunities for Cinedigm’s rapidly expanding portfolio of OTT
streaming networks
EXPANDS MARKET POSITION &
ACCELERATES GROWTH FOR COMBINED COMPANY
- Enables Future Today to immediately leverage more than 90 new
distribution outlets, immediately increasing revenue growth
- Provides existing Future Today and Cinedigm content partners
with new revenue generating services, including content
distribution
- Provides Future Today with additional capabilities in
marketing, content acquisitions and technology and gives Cinedigm
additional content, superior advertising, and AVOD-centric
technology capabilities
- Gives Future Today access to Cinedigm’s 28,000 digital library
rights for premium independent feature film titles & television
episodes and OTT channels, generating immediate audience and
revenue growth
- Reduces overall technology and operating costs for the combined
Company via economies of scale
INCREASES OPPORTUNITIES IN
HIGH-GROWTH MARKETS CHINA AND INDIA
- Given Cinedigm’s deep relationships in China, provides
near-term opportunities to expand Future Today’s business into that
market
- Given Future Today’s existing market expertise and operational
base in India, provides for reduced OTT operating costs and
potential for market expansion and expanded, low cost production of
additional high impact premium original content
SIGNIFICANTLY STRENGTHENS CHANNEL AND
CONTENT PORTFOLIO FOR KEY DISTRIBUTION
PARTNERS
- With more than 700 OTT channels, the acquisition dramatically
expands Cinedigm’s ability to offer OEMs, Telcos, and technology
companies significant content scale and reach quickly and
easily
- Enables Cinedigm to offer distributors a wide array of services
and products across AVOD, SVOD and linear
- Adds a broad range of free, ad-supported offerings that fulfill
key needs for vMVPDs and other providers seeking to target
cord-cutters
- Delivers market-leading offerings in food, lifestyle and kids
& family segments, fulfilling a strong demand from distribution
partners
- Strengthens original programming capabilities for low cost,
high impact content, particularly in the children’s, animated and
food categories
“Building our stake in the rapidly surging AVOD
business is a top priority for Cinedigm, and the acquisition of
Future Today instantaneously transforms our Company into the
world’s largest provider of premium AVOD content by adding an
established, fast growing and active platform that includes a high
volume of some of the most highly sought-after premium OTT
programming,” said Chris McGurk, Cinedigm Chairman and CEO. “Just
as important, the technology and distribution assets we will gain
will provide us with immediate launch points for expansion into
China and India. Future Today’s low-cost production assets combined
with our low-risk, co-production model will enable us to provide
exclusive, original premium content more quickly and with less risk
than our competitors. This acquisition will be a key go-forward
catalyst as we near the contractual end of our Cinema
Equipment operations. We will continue with our plans to sell
cinema equipment to our theater partners, as evidenced by the
recent sales of projection systems, and we will continue to
further streamline our entertainment distribution business. We are
very pleased to welcome Alok, Vikrant and the entire Future Today
team to Cinedigm.”
“Future Today’s pioneering technology platform,
massive install base, leading OTT brands in Kids and Entertainment
verticals, and AVOD footprint, combined with Cinedigm's premium
content and extensive distribution reach, should propel immediate
strong growth and create substantial shareholder value," said
Ranjan.
“We are very excited to be joining the Cinedigm
team as they share the same values and vision as the Future Today
team and look forward to building together the network of tomorrow
today,” said Mathur.
“Alok and Vikrant have built Future Today into
one of the most respected and fastest growing companies monetizing
video content today,” said Erick Opeka, President of Cinedigm
Digital Networks. “Their entrepreneurial spirit and deep knowledge
of the video ad space, combined with Cinedigm’s content and
relationships, will be a formidable and compelling combination in
the rapidly growing AVOD segment.”
“We have enjoyed working with Alok and Vikrant
and the Future Today team during
this acquisition process and are excited to build upon
the platform they have developed,” said Gary Loffredo, Chief
Operating Officer and General Counsel of
Cinedigm. “In addition, this acquisition is a huge step
in completing the transformation of Cinedigm into a focused leader
in the digital OTT streaming business.”
The transaction is expected to close in the second calendar
quarter of 2019 and is subject to customary closing conditions.
About
Cinedigm
Since inception, Cinedigm has been a leader at the forefront of the
digital transformation of content distribution. Adjusting to the
rapidly transforming business needs of today’s entertainment
landscape, Cinedigm remains a change-centric player focused on
providing content, channels and services to the world’s largest
media, technology and retail companies. Cinedigm’s Content and
Networks groups provide original and aggregated programming,
channels and services that entertain consumers globally across
hundreds of millions of devices. For more information, visit
www.cinedigm.com.
About Future TodayEstablished
in 2006 by Founder and CEO Alok Ranjan and Co-Founders Vikrant
Mathur, Sumeet Anand and Sharib Khan, Future Today, Inc is a
pioneer and leader in the OTT media and technology landscape having
launched its first suite of OTT channels in 2011. The company
has also successfully developed popular channels like HappyKids.tv
and Fawesome.tv. To date, the company has amassed more than 60
million downloads of their more 700+ channels across a diverse
segment of categories including food, lifestyle, news, sports, kids
and entertainment. The self-funded company runs a well managed,
cost-efficient and profitable operation. For more information,
visit www.futuretodayinc.com
Safe Harbor Statement Investors
and readers are cautioned that certain statements contained in this
document, as well as some statements in periodic press releases and
some oral statements of Cinedigm officials during presentations
about Cinedigm, along with Cinedigm's filings with the Securities
and Exchange Commission, including Cinedigm's registration
statements, quarterly reports on Form 10-Q and annual report on
Form 10-K, are "forward-looking'' statements within the meaning of
the Private Securities Litigation Reform Act of 1995 (the "Act'').
Forward-looking statements include statements that are predictive
in nature, which depend upon or refer to future events or
conditions, which include words such as "expects," "anticipates,''
"intends,'' "plans,'' "could," "might," "believes,'' "seeks,"
"estimates'' or similar expressions. In addition, any statements
concerning future financial performance (including future revenues,
earnings or growth rates), ongoing business strategies or
prospects, and possible future actions, which may be provided by
Cinedigm's management, are also forward-looking statements as
defined by the Act. Forward-looking statements are based on current
expectations and projections about future events and are subject to
various risks, uncertainties and assumptions about Cinedigm, its
technology, economic and market factors and the industries in which
Cinedigm does business, among other things. These statements are
not guarantees of future performance and Cinedigm undertakes no
specific obligation or intention to update these statements after
the date of this release.
For more information:Jill
Newhouse CalcaterraCinedigmjcalcaterra@cinedigm.com310-466-5135
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