Mar 15, 2012 - 08:56 AM GMT
Technicolor has announced that it has received a binding offer from Ericsson for the acquisition of its Broadcast Services activity. The offer includes a purchase price of €19 million and a potential earn-out based on 2015 revenues of the Broadcast Services activity of up to €9 million. Technicolor’s Broadcast Services activity provides play-out services, live production support and media asset management services. With approximately 900 employees (as of January 2012), it provides services in France, the UK and The Netherlands.
Frederic Rose, CEO of Technicolor, stated: “This transaction is consistent with Technicolor’s strategy to focus on media monetization solutions, new growth businesses, and strengthen its balance sheet. For Ericsson, managed services are a core business and after completion of this divesture, the Broadcast Services activity will benefit from the company’s know-how and global scale necessary to remain a key player in the worldwide Broadcast industry.”
For Technicolor, this transaction will contribute to the Group’s ongoing efforts to leverage its existing portfolio, optimize its investments allocation and free cash flow generation, as outlined in its 2012-2015 strategic roadmap presented on February 24, 2012. The transaction will also contribute to Technicolor’s focus on reducing its debt level and allocating capital investments to its other activities.
“As the TV industry is undergoing fundamental changes with the transition to multi-platform, on- demand television, teaming up with a trusted partner enables broadcasters to meet the increasing commercial and technological complexity and competition in the TV market”, said Magnus Mandersson, Executive Vice President and Head of Business Unit Global Services, Ericsson. “We combine our service and technology leadership with strategic investments in playout operations, broadcast capability and competence.”
The transaction is expected to close around mid 2012 and is subject to the relevant customary regulatory administrative approvals and consultations.