Chicken Soup For The Soul Entertainment Shares Rise On Sony Deal

CLICK HERE NOW

Shares of Chicken Soup For The Soul Entertainment (CSS Entertainment), which aims “to bring out the best of the human spirit through positive storytelling”  surged 19 percent Thursday after announcing plans to form a joint venture with Sony Pictures Television to acquire the Japanese company’s Crackle ad-supported video content network (AVOD).

CSS Entertainment will own the majority interest in the venture called Crackle Plus. Under terms of the deal, Sony will receive 4 million five-year warrants to purchase CSS Entertainment shares at various prices. According to the companies, the transaction is expected to more than double CSS Entertainment’s revenue and add “meaningful EBITDA (Earnings Before Interest, Taxation, Depreciation, and Amortization.  Further details of the financial terms of the acquisition weren’t disclosed.

Crackle Plus will be one of the largest AVOD platforms with a combined audience of nearly 10 million active users, more than 38,500 hours of programming and more than 90 content partnerships. Under terms of the deal, SPT will continue to own Crackle’s original content library which will be made available for licensing to the joint venture. SPT and Crackle Plus will also license popular TV series and movies from the Sony Pictures Entertainment Library.

“This transaction positions CSS Entertainment as a leader in the high-growth AVOD business,” said William J. Rouhana Jr., chairman, and chief executive officer of CSS Entertainment, in a press release. “Creating a new platform that brings together CSS Entertainment’s VOD assets with SPT’s Crackle brand and AVOD assets, establishes a compelling offering for viewers and advertisers.”

Unlike streaming services like Netflix which rely on subscriptions, AVOD services will be offered for free since they will be funded through advertising much like traditional television has operated for decades.  

The Crackle Plus deal comes less than six months after Viacom acquired an AVOD provider called Pluto TV $340 million in cash. Comcast’s NBCUniversal is planning to launch an AVOD service in 2020. Other media companies like CBS, AT&T’s WarnerMedia and ABC parent Walt Disney have gone the Netflix route.

Earlier this year, CBS announced it had reached its goal of reaching 8 million subscribers two years early.  CBS All-Access offering, ABC parent Walt Disney service plans to launch its Disney + streaming service later this year that is aimed at Netflix. WarnerMedia’s streaming service also is expected to debut this year.

Let’s block ads! (Why?)

Source link

Achieve Goals You Never Thought Possible 4X Faster