Redbox, the struggling DVD-rental kiosk operator and video streamer, is now part of Chicken Soup for Soul Entertainment — the streaming aggregator that gets its name from its best-selling series of self-help books.
Chicken Soup for Soul Entertainment announced Thursday that it has completed the acquisition of Redbox Entertainment in an all-stock transaction valued at approximately $375 million since the purchase agreement was announced in May.
The deal ends Redbox’s brief retaliation as a publicly traded entity. Redbox went public in October 2021 following a merger with a Special Purpose Acquisition Company (SPAC). But the company reported a sharp drop in business and rising losses, prompting Redbox to lay off 150 employees, up from about 10% of its workforce earlier this year. Redbox’s parent company, Outerwall, was taken private in 2016 by Apollo Global Management, before going public last year.
Redbox brings to its network about 36,000 kiosks in the US, a customer loyalty program with more than 40 million members, as well as ad-supported and transactional VOD services. CSSE and Redbox now have over 145 free ad-supported streaming TV (FAST) channels.
Chicken Soup for Soul Entertainment – whose parent company owns the rights to the book series of the same name – owns and operates AVOD streaming services including Crackle (which has been acquired from Sony Pictures Television), Popcornflix and Chicken Soup for the Soul. does. The company also acquires and distributes video content through its Screen Media and 1091 Pictures subsidiaries and produces original video content through Chicken Soup for Seoul Television Group.
The company expects revenue to more than triple to approximately $500 million annually through the Redbox acquisition.
“I’ve been looking forward to the day Redbox becomes part of Chicken Soup for the Soul Entertainment family – and today is that day,” said Bill Rouhana Jr., Chairman and CEO of Chicken Soup for the Soul Entertainment. Statement.
Chicken Soup for Soul Entertainment expects the combined company to exit 2022 and run in excess of $500 million in revenue before interest, taxes, depreciation and amortization (EBITDA) and $100 million-$150 million in adjusted earnings. Will come out with rate. CSSE said it expects to deliver annual run rate cost synergies of more than $40 million in 2023.
As previously announced, Chicken Soup for Soul Entertainment stockholders will own approximately 76.5% of the combined company, and Redbox stockholders will own approximately 23.5% of the combined company on a fully diluted basis.
With the end of the Redbox deal, CSSE appointed former Redbox CEO Galen Smith to the new role of Executive Vice President of Redbox and Chicken Soup for the Soul Entertainment. Smith will oversee the company’s growth plans, including strategic acquisitions. In addition, Jonathan Katz has been named president of Chicken Soup for Soul Entertainment. Katz previously held senior executive roles at Scripps Networks, Katz Networks and Turner Broadcasting. In the new role, he will oversee the company’s operational businesses, including streaming services, Redbox kiosks and original content studios. Smith and Katz report to Rouhana.