Kew Me­dia ac­quires Si­enna Films for $3-mil­lion

Kew Me­dia Group Inc. has ac­quired Si­enna Films. Kew paid $2.58-mil­lion in cash and $420,000 worth of Class B shares, with up to $3-mil­lion in ad­di­tional pay­ments con­tin­gent upon Si­enna’s fi­nan­cial per­for­mance.

Stockwatch Daily - - FRONT PAGE - Mr. Steven Silver re­ports

KEW ME­DIA Group Inc. has ac­quired Si­enna Films Inc., an es­tab­lished Toron­to­based pro­duc­tion com­pany.

Si­enna, founded by cel­e­brated pro­duc­ers Jennifer Kawaja and Ju­lia Sereny, brings an im­pres­sive and di­verse pro­duc­tion slate to Kew, as well as a ro­bust de­vel­op­ment pipe­line. Si­enna is known for scripted tele­vi­sion se­ries with in­ter­na­tional ap­peal in­clud­ing Car­di­nal (now in pro­duc­tion on sea­son 2 and 3 — aired on CTV in Canada, Hulu in the United States and BBC4 in the United Kingdom); Ransom (now in pro­duc­tion on sea­son 2 — aired on Global Tele­vi­sion in Canada and CBS in the U.S.); Com­bat Hos­pi­tal (for Global Tele­vi­sion in Canada and ABC in the U.S.); and Di­a­monds (for CBC in Canada and ABC in the U.S.) As well, Si­enna is known for crit­i­cally ac­claimed and award-win­ning fea­ture films in­clud­ing Touch of Pink (Sony) and How She Move (Paramount).

This ac­qui­si­tion, Kew’s sec­ond since its qual­i­fy­ing ac­qui­si­tion in March, 2017, marks the com­pany’s en­try into the pro­duc­tion of scripted pro­gram­ming, and rep­re­sents a highly com­ple­men­tary and strate­gic ad­di­tion to Kew’s as­set base. Si­enna in­tro­duces a strong new mix of con­tent into the com­pany, lay­ing a solid foun­da­tion for con­tin­ued scripted growth. The ac­qui­si­tion is ex­pected to be ac­cre­tive to Kew’s earn­ings over the next 12 months.

Kew Me­dia paid con­sid­er­a­tion on clos­ing of $3-mil­lion for Si­enna, com­pris­ing $2.58-mil­lion in cash and $420,000 in Class B shares, rep­re­sent­ing a mul­ti­ple of 2.7 times es­ti­mated an­nual trail­ing ad­justed EBITDA (earn­ings be­fore in­ter­est, taxes, de­pre­ci­a­tion and amor­ti­za­tion) of $1.1-mil­lion.

The Si­enna ven­dors can earn up to an ad­di­tional $3-mil­lion in con­tin­gent con­sid­er­a­tion based on Si­enna’s ad­justed EBITDA in 2017, 2018 and 2019. The Si­enna ven­dors can earn (a) $600,000 of the con­tin­gent con­sid­er­a­tion if the fis­cal year 2017 ad­justed EBITDA is a min­i­mum of $1.1-mil­lion (rep­re­sent­ing a mul­ti­ple of 3.3 times) (b) an ad­di­tional $1.2-mil­lion of the con­tin­gent con­sid­er­a­tion if the com­bined ad­justed EBITDA for fis­cal year 2017 and fis­cal year 2018 is $2.42-mil­lion (rep­re­sent­ing an av­er­age mul­ti­ple of four times) or fis­cal year 2018 ad­justed EBITDA ex­ceeds $1.32-mil­lion (rep­re­sent­ing a mul­ti­ple of 3.6 times fis­cal year 2018’s ad­justed EBITDA) (c) a fur­ther $1.2-mil­lion if the ad­justed EBITDA for fis­cal year 2019 ex­ceeds $1.58-mil­lion (rep­re­sent­ing a mul­ti­ple of 3.8 times fis­cal year 2019’s ad­justed EBITDA ). If any of the con­tin­gent con­sid­er­a­tion pay­ments in ei­ther (a), (b) or (c) above are not achieved and the com­bined ad­justed EBITDA for FY 2017, FY 2018 and FY 2019 is a min­i­mum of $4,004,000, the Si­enna ven­dors would be en­ti­tled to the full $3-mil­lion con­tin­gent con­sid­er­a­tion less any amounts paid in FY 2017 and FY 2018 (rep­re­sent­ing an av­er­age mul­ti­ple of 4.5 times). The above mul­ti­ples would be re­duced if Si­enna ex­ceeds the min­i­mum EBITDA tar­gets.

“Jennifer and Ju­lia have built an ex­cep­tional com­pany through cre­ative and in­no­va­tive work and have proven time and again the abil­ity to de­velop and de­liver qual­ity con­tent,” said Kew’s chief ex­ec­u­tive of­fi­cer, Steven Silver. “We wel­come these two truly great pro­fes­sion­als into our group.”

“As in­de­pen­dent con­tent pro­duc­ers who have de­voted our ca­reers to com­pelling and mean­ing­ful sto­ries for a range of au­di­ences, the op­por­tu­nity to be part of Kew Me­dia’s strong in­ter­na­tional plat­form is ex­tremely ex­cit­ing,” said Si­enna’s co-founders Ms. Kawaja and Ms. Sereny.

About Kew Me­dia Group Inc.

Kew Me­dia Group is a lead­ing pub­licly listed con­tent com­pany that pro­duces and dis­trib­utes multi­genre con­tent world­wide. Com­pa­nies in­cluded in the Kew fam­ily are the pro­duc­tion com­pa­nies: Ar­chi­tect Films, Bris­tow Global Me­dia, Camp­fire Film & Tele­vi­sion, Collins Av­enue Pro­duc­tions, Fran­tic Films, Jig­saw Pro­duc­tions, Me­dia Head­quar­ters, Our House Me­dia and Spirit Dig­i­tal Me­dia; and the dis­tri­bu­tion com­pa­nies Con­tent Me­dia Corp. (now re­branded Kew Me­dia) and TCB Me­dia Rights.

We seek Safe Har­bor.

Sarah Caro­line Cur­ran, David Alexan­der Fleck, Mau­rice Ka­gan, Wayne Pur­boo, Les­lie Wayne Sher­man, Steven Silver, Peter A Suss­man, Neil Ta­batznik, Nancy Tellem

(KEW) Shares: 12,011,501

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