Cinedigm Sells Majority Stake to Hong Kong's Bison Capital for $40M
Bison will buy 20 million newly issued shares of Cinedigm for up to $30 million and provide as much as $10 million in working capital.
In the latest China-Hollywood tie-up, Cinedigm has agree to sell majority equity ownership to Bison Capital, a Hong Kong-based investor in film and TV production.
Under the terms of the deal, Bison will buy 20 million newly issued shares of Cinedigm for up to $30 million and provide as much as $10 million in working capital within 60 days of the stock sale.
Cinedigm got its start helping smaller theater chains convert to digital projection, but today it is known for creating programming for Netflix, Amazon and other online outlets.
"We will leverage Cinedigm's content access and distribution capabilities to bring more premium, independent content into the China market," said Peixin Xu, founder of Bison Capital, in the statement. "Despite its rapid growth, China remains greatly under-served in terms of content quality and diversity."
"We also see an opportunity to leverage Cinedigm’s OTT capabilities to launch Chinese content channels in the North American market," he added.
A large share of the cash influx from Bison Capital will go toward paying down Los Angeles-based Cinedigm's debt.
"We believe Bison Capital is the perfect financial and strategic partner to help take Cinedigm’s unique business model to the next level as a leading global digital entertainment company," said Chris McGurk, Cinedigm chairman and CEO.
Cinedigm currently operates four OTT channels, including: Dove Channel, featuring family programming; Docurama, with over 1,200 documentary titles; and CONtv, for Comic-Con fans with 2,500 hours of original programming.
Bison Capital is an active investor in the media and entertainment, health care and financial service industries. In the entertainment sector, it has invested in leading Chinese studio Bona Film Group and Beijing-based mobile ticketing and film marketing giant Weying.
Cinedigm will hold a meeting of stockholders in the third quarter of 2017, where it will seek stockholder approval of the transaction.