Accelerates Redbox’s digital transformation
Positions Redbox to simplify the streaming
experience with an affordable, multi-product entertainment
ecosystem
Redbox common stock expected to begin trading
on NASDAQ under ticker symbol RDBX on October 25, 2021
Redbox (NASDAQ: RDBX), America's destination for affordable
new-release movies and entertainment, announced today that it has
completed its previously announced business combination with
Seaport Global Acquisition Corp. (NASDAQ: SGAM) ("Seaport Global
Acquisition"), a publicly traded special purpose acquisition
company. As a result of the merger, the entity will be known as
“Redbox Entertainment Inc.” Redbox’s common stock and warrants are
expected to begin trading on NASDAQ on Monday, October 25, 2021,
under the ticker symbols “RDBX and “RDBXW,” respectively.
“Today marks the beginning of Redbox’s next chapter,” said Galen
Smith, CEO of Redbox. “Since revolutionizing the way Americans rent
movies nearly two decades ago, Redbox has continuously evolved and
expanded our reach – all while offering our millions of loyal
customers exceptional value in home entertainment. Today, we are
building on our legacy and reaffirming our commitment to delivering
a wide range of choice and convenience for consumers, as well as
value for our Redbox stakeholders.”
Smith continued, “As a public company, we plan to continue our
strong momentum and accelerate our digital transformation. Through
this transaction, and the incremental capital it provides, Redbox
is equipped to advance our goal of creating a one stop experience
that spans multiple entertainment mediums and simplifies the
streaming experience. We are eager to capture the significant and
growing opportunities ahead, take our business to the next level
and achieve profitable growth for Redbox shareholders.”
Redbox Continues to Generate Strong Momentum
In recent months, Redbox has:
- Entered into a multiyear distribution agreement with Lionsgate,
under which Lionsgate will distribute Redbox Entertainment™ titles
across home entertainment windows in addition to subscription video
on demand (SVOD) licensing for select titles under the Redbox
Entertainment brand.
- Expanded the distribution footprint for its streaming app to
the PlayStation 5 console, allowing consumers to stream thousands
of Ad Supported Video on Demand (AVOD) movies and TV shows, as well
as over one hundred Free Ad Supported TV (FAST) channels.
- Signed a promotional agreement with Roku® to further attract
multi-platform users to the Redbox streaming app. Through mid-2022,
consumers will receive a $5 streaming code on Roku players sold
exclusively at Walmart.
- Announced it will add over 20 Free Ad Supported Television
(FAST) channels to its streaming service including live local news,
Spanish language, and kids programming, bringing the total number
of channels available to over 100.
- Signed a distribution agreement with Vewd – one of the world’s
largest providers of OTT and hybrid TV solutions – to pre-load the
Redbox streaming app on new and existing Vewd powered TVs and
set-top boxes in the US.
Transaction Overview
The business combination was unanimously approved by the
parties’ Boards of Directors, and approved by Seaport Global
Acquisition’s stockholders at a special meeting on October 20,
2021.
The transaction, combined with a fully committed PIPE of $50
million led by Ophir Asset Management and backstop agreements with
certain funds announced on October 11, 2021, will provide Redbox
with approximately $88 million in cash. Redbox intends to use the
funds from the transaction to pay down existing debt, pay
transaction costs and fees, fund future growth investments, and for
general corporate purposes.
The final number of shares redeemed totaled 12,346,223. As a
result, Redbox will have approximately 45.4 million shares
outstanding, of which approximately 2.0 million shares will be
immediately tradeable. The shares that will be purchased as part of
the backstop agreements, along with the PIPE, will be registered
for resale separately in the future.
Advisors
B. Riley Securities acted as capital markets advisor to Seaport
Global Acquisition and lead placement agent on the PIPE. BTIG, LLC
acted as lead financial advisor and capital markets advisor to
Redbox. Moelis & Company LLC also served as a financial advisor
to Redbox. Apollo Global Securities and BTIG, LLC also served as
placement agents on the PIPE. Wedbush Securities and Canaccord
Genuity LLC acted as capital market advisors.
Paul Hastings LLP acted as legal advisor to Seaport Global
Acquisition. Paul, Weiss, Rifkind, Wharton & Garrison LLP acted
as legal advisor to Redbox. Kirkland & Ellis LLP acted as legal
advisor to the placement agents.
About Redbox
Redbox (NASDAQ: RDBX) is a leading entertainment company that
gives consumers access to a large variety of content across digital
and physical media. The company operates a rapidly growing digital
streaming service that provides both ad supported (AVOD) and paid
movies from Hollywood studios and hundreds of content partners, as
well as over 100 channels of free ad supported streaming television
(FAST). The Redbox app is available on major entertainment
platforms that include Roku devices, connected TVs, gaming
platforms, the web as well iOS and Android devices. Redbox also
operates its popular kiosks across the US at thousands of retail
locations – giving consumers affordable access to the latest in
entertainment. The company produces, acquires, and distributes
movies through its Redbox Entertainment label, providing rights to
talent-led films that are distributed across Redbox’s digital and
physical services as well as through third-party digital services.
Headquartered just outside of Chicago, Redbox has offices in Los
Angeles and Seattle. For more information visit www.redbox.com.
Forward-Looking Statements
This communication includes certain statements that are not
historical facts but are forward-looking statements for purposes of
the safe harbor provisions under the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
statements generally are, but not necessarily, accompanied by words
such as "believe," "may," "will," "estimate," "continue,"
"anticipate," "intend," "expect," "should," "would," "plan,"
"predict," "potential," "seem," "seek," "future," "outlook," and
similar words or expressions that predict or indicate future events
or trends or that are not statements of historical matters. All
statements, other than statements of present or historical fact
included in this communication, regarding the business combination
between Redbox and Seaport Global Acquisition, the benefits of the
transaction and Redbox's future financial performance and
condition, as well as Redbox's strategy (including acceleration of
digital services and provision of a simplified streaming experience
and more affordable entertainment ecosystem), future operations and
condition, Redbox’s NASDAQ exchange trading, prospects, plans and
objectives of management are forward-looking statements. These
statements are based on various assumptions, whether or not
identified in this communication, and on the current expectations
of the management of Redbox and are not predictions of actual
performance. These forward-looking statements are provided for
illustrative purposes only and are not intended to serve as, and
must not be relied on as, a guarantee, an assurance, a prediction
or a definitive statement of fact or probability. Actual events and
circumstances are difficult or impossible to predict and will
differ from assumptions. Many actual events and circumstances are
beyond the control of Redbox. Potential risks and uncertainties
that could cause the actual results to differ materially from those
expressed or implied by forward-looking statements include, but are
not limited to, changes in domestic and foreign business, market,
financial, political and legal conditions; failure to realize the
anticipated benefits of the business combination, including Redbox
management’s plans for accelerating digital and expanding and
simplifying Redbox’s streaming and other digital services; the
overall level of consumer demand for Redbox's products, including
kiosk rental and digital usage; general economic conditions and
other factors affecting consumer confidence, preferences, and
behavior; disruption and volatility in the global currency,
capital, and credit markets, as well as NASDAQ’s decisions relating
to Redbox and its securities, including their trading; the
financial strength of Redbox's customers; Redbox's ability to
implement its business and growth strategy, including providing an
affordable, multi-product entertainment ecosystem; changes in
governmental regulation, Redbox's exposure to litigation claims and
other loss contingencies; disruptions and other impacts to Redbox's
business, as a result of the COVID-19 pandemic and government
actions; Redbox's ability to retain and expand customer
relationships; competitive pressures from many sources, including
those using other distribution channels, having more experience,
larger or more appealing inventory, better financing, and better
relationships with those in the physical and streaming movie and
television industries; developments in the home video distribution
market as newer technologies and distribution channels compete for
market share, and Redbox experiences a secular decline in the
physical rental market; the impact of decreased quantity and
quality of movie content availability for physical and digital
distribution due to changes in quantity of new releases by studios,
movie content failing to appeal to consumers' tastes, increased
focus on digital sales and rentals, and other general
industry-related factors; the termination, non-renewal or
renegotiation on materially adverse terms of Redbox's contracts or
relationships with one or more of its significant retailers or
studios; Redbox's inability to obtain licenses to digital movie or
television content for home entertainment viewing; Redbox's
reliance upon a number of partners to make its digital service
available on their devices; unforeseen costs and potential
liability in connection with content Redbox acquires, produces,
licenses and/or distributes through its service; the impact of the
COVID-19 pandemic on Redbox's business, results of operations and
financial condition, its suppliers and customers and on the global
economy; the impact that global climate change trends may have on
Redbox and its suppliers and customers; Redbox's ability to protect
patents, trademarks and other intellectual property rights; any
breaches of, or interruptions in, information systems; fluctuations
in the price, availability and quality of electricity and other raw
materials and contracted products as well as foreign currency
fluctuations; changes in tax laws and liabilities, tariffs, legal,
regulatory, political and economic risks. More information on
potential factors that could affect Redbox's financial results is
included from time to time in Redbox’s (and previously Seaport
Global Acquisition's) public reports filed with the SEC, including
its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and
Current Reports on Form 8-K as well as the preliminary and the
definitive proxy statements filed with the SEC in connection with
the solicitation of proxies for the meeting of stockholders that
approved the business combination. If any of these risks
materialize or Redbox's assumptions prove incorrect, actual results
could differ materially from the results implied by these
forward-looking statements. There may be additional risks that
Redbox presently does not know, or that Redbox currently believes
are immaterial, that could also cause actual results to differ from
those contained in the forward-looking statements. In addition,
forward-looking statements reflect Redbox's expectations, plans or
forecasts of future events and views as of the date of this
communication. Redbox anticipates that subsequent events and
developments will cause their assessments to change. However, while
Redbox may elect to update these forward-looking statements at some
point in the future, Redbox specifically disclaims any obligation
to do so, except as required by law. These forward-looking
statements should not be relied upon as representing Redbox's
assessments as of any date subsequent to the date of this
communication. Accordingly, undue reliance should not be placed
upon the forward-looking statements.
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version on businesswire.com: https://www.businesswire.com/news/home/20211022005499/en/
Media Peter Binazeski Peter.binazeski@redbox.com
Investors Scott Bisang / Katelyn Villany Joele Frank, Wilkinson
Brimmer Katcher sbisang@joelefrank.com, kvillany@joelefrank.com
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