Microsoft to Enable Xbox Games Play on Rival Nintendo Platform

Microsoft Feb. 21 announced it would allow its Xbox video games on the rival Nintendo platform. Brad Smith, vice chairman and president of the software giant, made the announcement of the 10-year partnership between the two gaming companies on social media.

Key to the deal would be the availability of Activision titles on Nintendo, including all “Call of Duty” titles, one of the all-time most-popular game franchises. Microsoft is currently facing some pushback from regulators in Europe and the U.S. regarding its $68.7 billion acquisition of Activision.

Smith and a reported 18 executives from Microsoft and Activision were set to meet Feb. 21 with European Union regulators, according to Reuters. Representatives from Sony Interactive Entertainment. Google and Entertainment Arts (EA), which all oppose the merger, are also set to attend.

Wall Street investment firm Deutsche Bank Feb. 16 issued a note underscoring the importance key video game franchises play in the current gaming market.

“December quarter results for the major U.S. video game publishers demonstrated that, across the industry, consumer spending patterns are getting weaker overall, and users are increasingly gravitating towards the biggest franchises and the most well known IP,” analyst Benjamin Soff wrote.

In its most-recent fiscal period, Activision reported a 43% uptick in video game license revenue to $3.75 billion, from $2.5 billion in the previous-year period — led by “Call of Duty.”

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Nielsen Postpones $16 Billion Buyout Meeting to Deal With Dissident Shareholder

Nielsen Holdings Plc. on Aug. 9 announced that the court meeting and special vote of its shareholders due to be held today on the media ratings firm’s $16 billion acquisition by a private equity company have been postponed.

The events were delayed in order to reach a deal with dissident shareholder The WindAcre Partnership LLC, owner of about 27% of Nielsen’s common stock. WindAcre has opposed the buyout by private equity group Evergreen Coast Capital Corp., an affiliate of Elliott Investment Management L.P., and Brookfield Business Partners L.P.

Under a preliminary agreement, WindAcre would join the private equity groups based on its equity stake and would receive the same $28 per share price to be paid to all other shareholders for its remaining shares.

If WindAcre approves the deal, Nielsen said it would submit the agreement to shareholders for approval as expeditiously as possible.

Nielsen and the private equity groups remain bound by the terms of the proposed transaction, and Nielsen’s Board of Directors has made no change to its recommendation that its shareholders vote in favor of the proposed transaction.

Analytics Firms The NPD Group, Information Resources Merge

The NPD Group, a provider of market information and advisory services in more than 20 industries, including home entertainment and video games, is merging with Information Resources. The combination aims to create a global technology, analytics and data provider that offers clients a view of retail and consumption trends. The transaction, which is subject to customary closing conditions, is expected be completed in the second half of 2022. Terms of the agreement were not disclosed.

Kirk Perry, CEO of IRI, will be the chief executive officer of the combined companies, with NPD CEO Karyn Schoenbart joining the board of the combined companies. NPD executive chairman Tod Johnson will be chairman of the new board. Jeff Ansell, current chairman of IRI’s board, will continue on the combined company’s board as well. Johnson and Schoenbart will continue to lead NPD until closing and will remain investors in the combined company.

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“This combination is a win for IRI, NPD, our clients and our teams as we bring together two industry leaders to offer a total store view,” Perry said in a statement. “We look forward to joining forces with the NPD team, which brings expertise in parts of the store that IRI does not cover today. As the global retail landscape continues to evolve, IRI and NPD will have innovative technology, analytics, data resources, talent and geographic reach to best support the growth of the world’s leading brands and retailers.”

NPD CEO Karyn Schoenbart added, “We are excited about the prospect of combining our companies to give clients the tools and information they need to succeed amid changing consumer behavior. Both NPD and IRI share similar client-focused, innovative and collaborative cultures, making this combination a natural fit.”

H&F, a global private equity firm, will acquire a majority stake in IRI and merge IRI with H&F portfolio company NPD. H&F will lead an ownership group consisting of existing long-term IRI investors Vestar Capital Partners and New Mountain Capital, which will both retain significant investments in the combined company.

Evercore, Goldman Sachs & Co. and Guggenheim Securities are serving as financial advisors to IRI, and Kirkland & Ellis is serving as legal counsel. Jefferies Group is serving as exclusive financial advisor to NPD and H&F, and Simpson Thacher & Bartlett is serving as legal counsel. Kramer Levin is serving as legal counsel to Johnson and Schoenbart.

Nielsen Sold to Private Equity Groups for $16 Billion

What a difference $1 billion makes. Media measurement giant Nielsen March 29 announced it has agreed to be sold to two private equity groups in an all-cash deal worth $16 billion, which includes the assumption of all outstanding debt. The sale is expected to close in the second quarter following regulatory approval, which includes the United Kingdom.

The sales agreement with Evergreen Coast Capital Corporation and Brookfield Business Partners follows on the heels of a previously rejected $15 billion deal Nielsen contended didn’t “adequately compensate” shareholders for Nielsen’s growth prospects. That deal included Nielsen investor Elliott Management Corp., which is affiliated with current suitor Evergreen.

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“After a thorough assessment, the board determined that this transaction represents an attractive outcome for our shareholders by providing a cash takeout at a substantial premium, while supporting Nielsen’s commitment to our clients, employees and stakeholders,” chairman James Attwood said in a statement. “The consortium sees the full potential of Nielsen’s leadership position in the media industry and the unique value we deliver for our clients worldwide.”

The deal comes as Nielsen has seen it legacy TV ratings business model challenged by media giant clients, including NBCUniversal, WarnerMedia, and Paramount Global (formerly ViacomCBS), who questioned Nielsen’s ability to properly adapt to tracking digital consumers, including subscription streaming video consumers.

Nielsen last year launched branded weekly top 10 charts for most-streamed content across household televisions — a metrics largely dominated by Netflix.

Regardless, senior executives at Evergreen and Brookfield say the Nielsen brand still commands respect in the crowded media measurement ecosystem.

“After months of deep market analysis, industry diligence and management reviews, we are firmly convinced that Nielsen will continue to be the gold standard for audience measurement,” said Jesse Cohn, a managing partner, and Marc Steinberg, a senior portfolio manager, with Evergreen and Elliott, respectively. “Having first invested in Nielsen nearly four years ago, we have a unique appreciation for the company’s ongoing relevance to the global, digital-first media ecosystem. Today’s outcome represents a significant win for Nielsen’s shareholders and for the business itself, as our multibillion-dollar investment will help Nielsen reinforce its transformation at this critical inflection point.”

Ashwin Navin, co-founder/CEO of Samba TV, said the Nielsen acquisition is evidence of the demand that we and others are seeing from the capital markets to fund the next generation of media measurement companies.

“The ad industry is moving to a multi-currency future, where omni-channel measurement systems built on first-party data need to capture everything that viewers see on a global scale,” Navin said. “Nielsen’s legacy in measurement is quite strong and going private should give the company the time and resources needed to retool and develop future-proof solutions that play in this multi-currency world.”

AT&T Favors WarnerMedia Spin-Off Over Split, Wall Street Disagrees

AT&T Feb. 1 announced that its board of directors has decided to spin off AT&T’s interest in WarnerMedia instead of a split enabling the telecom’s shareholders to exchange their shares for stock in the new Warner Bros. Discovery company in connection with the previously announced $43 billion transaction with Discovery.

The transaction, which will spin off 100% of AT&T’s interest in WarnerMedia to AT&T’s existing shareholders in a pro rata distribution, followed by the merger of WarnerMedia with Discovery, is expected to close in the second quarter of 2022.

Additionally, AT&T’s board approved an expected post-close annual dividend of $1.11 per AT&T share, to account for the distribution of WarnerMedia to AT&T shareholders, and to size the annual dividend payout at approximately 40% of projected free cash flow to enable investment in attractive growth opportunities.

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As previously disclosed, under the terms of the transaction, which is structured as an all-stock, Reverse Morris Trust transaction, AT&T will receive $43 billion (subject to working capital and other adjustments) in a combination of cash and other consideration, and AT&T’s shareholders will receive stock representing approximately 71% of the new company, Warner Bros. Discovery (WBD), on a fully diluted basis. Existing Discovery shareholders will own approximately 29% of the new company on a fully diluted basis.

On the closing date of the transaction, each AT&T shareholder will receive, on a tax-free basis, an estimated 0.24 shares of the new WBD common stock for each share of AT&T common stock held as of the record date for the pro rata distribution. The exact number of shares of WBD to be received by AT&T shareholders for each AT&T common share will be determined closer to the closing based on the number of shares of AT&T common stock outstanding and the number of shares of Discovery common stock outstanding on an as-converted and as-exercised basis. AT&T has approximately 7.2 billion fully diluted shares outstanding. AT&T shareholders will continue to hold the same number of shares of AT&T after the transaction closes.

“In evaluating the form of distribution, we were guided by one objective — executing the transaction in the most seamless manner possible to support long-term value generation,” AT&T CEO John Stankey said in a statement. “We are confident the spin-off achieves that objective because it’s simple, efficient and results in AT&T shareholders owning shares of both companies, each of which will have the ability to drive better returns in a manner consistent with their respective market opportunities.”

While the fiscal difference between a spin-off and split is largely in the weeds, AT&T’s announced dividend following the closing of the deal is almost half the telecom’s annual dividend of $2.08 per share. That news sent AT&T’s shares down almost 6% in premarket trading.

Stankey remained upbeat on the deal’s future impact for the telecom.

“We believe that the remaining AT&T and the new WBD are two equities that the market will want to own and the markets to support those equities will develop,” he said. “Rather than try to account for market volatility in the near-term and decide where to apportion value in the process of doing an exchange of shares, the spin-off distribution will let the market do what markets do best. We are confident both equities will soon be valued on the solid fundamentals and attractive prospects they represent.”

Redbox, Seaport Global Announce Meeting to Approve Business Combination

Seaport Global Acquisition Corp., the publicly traded special purpose acquisition company that bought Redbox in May, Oct. 1 announced it filed a definitive proxy statement with the U.S. Securities and Exchange Commission (the “SEC”) on Sept. 29 regarding a planned special meeting Oct. 20 to confirm the $693 million transaction that would make Redbox a publicly traded company again.

The special meeting will be held at 10 a.m. ET online to allow for greater participation in light of the public health impact of the COVID-19 pandemic. Stockholders may participate by visiting

“We are taking an important step toward completing our business combination and returning Redbox to the public markets,” Galen Smith, CEO of Redbox, said in a statement. “We are making significant progress transforming our business and have built a unique multi-product offering that spans both physical and digital. Redbox is positioned to provide entertainment-loving consumers with more choice while addressing an important market gap as more consumers cut the cord and search for affordable entertainment.”

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Stephen Smith, CEO of Seaport Global Acquisition, said Redbox continues to establish a differentiated customer base and a unique, innovative digital offering that provides substantial value to both consumers and investors alike.

“Today, we are more confident than ever in the significant opportunities ahead for Redbox, and are excited to partner with the team to take the business to the next level,” Smith said.

If certain of the proposals at the special meeting are approved, the parties anticipate the business combination will close shortly thereafter, subject to the satisfaction or waiver (as applicable) of all other closing conditions.

Comcast, Apple Kicked MGM Tires, Valued Studio Less Than Amazon Does

NEWS ANALYSIS — With Amazon reportedly considering spending $9 billion to acquire MGM to supercharge its movie and TV production ambitions, questions remain just how valuable the vaunted Hollywood studio is.

MGM, which is owned by private-equity group Anchorage Capital, has been on the sales block since last year — enticing would-be buyers with a 4,000-movie catalog that includes the “James Bond,” “Rocky,” “RoboCop,” “Pink Panther,” “Tomb Raider,” “Chucky” and “Legally Blonde” franchises. Some of the titles would require new sequels to jumpstart renewed moviegoer interest. Comcast and Apple looked at the books and valued the studio at around $6 billion, according to the New York Times.

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Sanchit Jain, media analyst with Enders, believes Amazon would be willing to pay more since it eyes movies and TVs as a marketing extension of its Prime membership platform.

“They may be prepared to pay more because you get people into Prime Video, and two or three weeks later they go for fully charged Amazon Prime with e-commerce, music, etc.,” Jain said. “It makes the entry point to the Amazon flywheel more appealing. With Amazon it is all about subscription growth.”

While MGM Chairman Mike De Luca pitched Amazon the studio’s upcoming movie slate that includes biopic Respect, on the life and career of Aretha Franklin, starring Jennifer Hudson, and House of Gucci, starring Lady Gaga and Adam Driver — the fact remains MGM only controls 50% of the vaunted Bond franchise, with the remainder owned by Barbara Broccoli and her brother Michael Wilson through their production company. The siblings reportedly have total control on who plays Bond, script dialog, casting decisions, stunts and related marketing. Previous attempts to spin off the Bond character in TV series have been rebuffed by the sister and brother.

No Time to Die, the 25th Bond movie, and last with Daniel Craig in the title role after 15 years, is slated to hit theaters Oct. 8 after multiple delays due to the pandemic.

Amazon, which paid more than $13 billion for Whole Foods, is one of the few companies with the deep pockets required to pull the trigger on an acquisition. The e-commerce behemoth recently re-hired Jeff Blackburn, an architect of of its Prime streaming service, to head the company’s global media and entertainment operations. Jennifer Salke heads Amazon Studios — a studio that has remained loyal to the ever-shortening theatrical window.

“MGM is a production studio that, with an injection of capital, could do really great,” Tim Richards, CEO of the VUE theatrical chain in the U.K., told the Evening Standard. “When you have films that are grossing well in excess of $1 billion, any business in the world would look at that and not change the [business] model.”

Richards contends that until pandemic hit, the theatrical business was booming compared with declines in home entertainment.

“2019 was a $43 billion box office year,” he said. “This was growing every single year.”


ViacomCBS Selling CNET Media Group for $500 Million

Zeroing in, during the pandemic, on streaming, ViacomCBS appears to have little room for other businesses such as CNET, Simon & Shuster publishing and commercial office space.

The corporate parent to Paramount Pictures Sept. 14 disclosed it has secured a $500 million sale of its CNET Media Group to private equities group Red Ventures. The transaction, which is expected to close in the fourth quarter, is subject to regulatory approvals and customary closing conditions.

CNET Media Group is a pioneer in digital media, with an expansive portfolio of digital media brands that advise consumers across consumer tech, business tech, gaming, and entertainment media brands, including ZDNet, in B2B focused content and Gamespot, a video games information brand. The portfolio also includes entertainment and lifestyle brands TVGuideMetacritic, and Chowhound.

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“I believe that the combination of Red Ventures customer experience platform and CNET Media Group’s rich content and deep editorial expertise greatly benefits both our audiences and our partners,” Mark Larkin, EVP and GM of CNET Media Group, said in a statement. “Red Ventures shares our vision and is committed to realizing the full potential of our portfolio of world-class brands.”

Larkin and his senior team will remain with the company to continue their leadership of the CNET Media Group team following the acquisition.

FuboTV Merging With AI Company, Plans IPO

Online live-TV streaming platform fuboTV and FaceBank Group, a sports-themed virtual entertainment company, March 23 announced a definitive merger agreement. Financials details of the agreement were not disclosed. The boards of directors of both companies and the major stockholders of fuboTV have approved the transaction, which is anticipated to close during the first quarter of 2020, subject to the satisfaction of certain closing conditions.

Following the closing, fuboTV will become a subsidiary of FaceBank, and FaceBank will be renamed fuboTV Inc. The combined company is expected to be headquartered in New York and led by fuboTV CEO David Gandler. Additional announcements regarding the combined company’s management structure and the board of directors will be forthcoming.

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The merger would combine fuboTV’s live TV streaming platform with FaceBank’s technology-driven IP in sports, movies and live performances. This combination will create a content delivery platform for traditional and future-form IP.

“As a tech-driven IP company, FaceBank was looking to find the perfect delivery platform for its celebrity and consumer driven content,” founders John Textor and Alex Bafer said in a statement.

fuboTV said it plans to leverage FaceBank’s IP sharing relationships with celebrities and other digital technologies to enhance its sports and entertainment offerings.

The companies also believe the merger will position fuboTV to continue its global expansion with FaceBank’s Nexway AG, an ecommerce and payment platform with a business presence in 180 countries, accepting payments in roughly 140 currencies. fuboTV was the first virtual MVPD to commit to global expansion and in 2018 entered Europe with its launch in Spain.

“The business combination of FaceBank Group and fuboTV accelerates our ability to build a category-defining company and supports our goal to provide consumers with a technology-driven cable TV replacement service for the whole family,” Gandler said in a statement.

Gandler said that in the current COVID-19 environment, stay-at-home stocks make perfect sense.

“We plan to accelerate our timing to up-list to a major exchange as soon as practicable,” Gandler said.

Since its founding in 2015 as a soccer streaming service, fuboTV has evolved into a live TV streaming platform with sports, news and entertainment channels.

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TiVo Merging With Xperi in $3 Billion Transaction

DVR pioneer TiVo has shelved plans to separate its legacy set-top hardware business from software licensing and is merging with Xperi, a marketer of audio technology in an all stock deal worth about $3 billion.

The company will operate under the Xperi corporate name while TiVo will continue to operate its brand name. Xperi CEO Jon Kirchner will be chief executive of the combined companies with CFO Robert Andersen assuming the same position. TiVo CEO Dave Shull, who took the position in May, will serve as a strategic advisor.

“This landmark combination brings together two highly complementary companies poised to set the industry standard for user experiences across the digital value chain,” Kirchner said in a statement.

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With more than 10,000 patents and applications between the two companies and minimal licensee overlap, the combined IP business will be one of the largest licensing companies in the world.

Together, the companies expect to benefit from a larger and stronger platform to drive growth, accelerate time-to-market, and improve IP licensing monetization and outcomes. The product business expects to pursue substantial cross-selling opportunities especially in its home and automotive markets.

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The new company had $1.09 billion in TiVo revenue and Xperi billings topped more than $250 million in operating cash flow on a pro forma basis for the twelve months ended Sept. 30, 2019.

The companies expect to achieve at least $50 million of annualized run-rate cost savings by year-end 2021 through the integration of their respective product and IP licensing businesses, the majority of which are expected within the first twelve months after closing. These cost savings are incremental to those that are expected as a result of TiVo’s ongoing cost-transformation plan.

“In a rapidly expanding and fragmenting digital universe, consumers want and need to be able to easily find and enjoy the content that matters to them,” Shull said.  “With Xperi’s annual licensing of more than 100 million connected TV units, and complementary relationships with major content providers, consumer electronics manufacturers, and automotive OEMs, our combined company will transform the home, car, and mobile entertainment experience for the consumer.”