* Deal expected to close in first quarter 2011
* Regulatory filings needed in US and Singapore
* Encompass will gain presence in Asia and Europe
By Nadia Damouni
NEW YORK, Dec 3 Ascent Media Corp (ASCMA.O),
partly owned by billionaire media mogul John Malone, has sold
its content distribution business for $113 million to privately
owned media service provider Encompass Digital Media.
The deal announcement comes just over a week after Ascent
said it was selling its creative services and media services
businesses to Deluxe Entertainment Services Group for $68
million, including the assumption of cash and debt.
Ascent said at the time that it was pursuing strategic
alternatives for both its content distribution and systems
integration businesses, and that it would pursue investments or
acquisitions, without disclosing specific details.
The deal will move Encompass, formerly named Broadcast
Facilities, into the European and Asian markets. "The primary
attraction is it is an extremely complementary transaction,"
Simon Bax, CEO and founder of Encompass, told Reuters.
In addition, it will provide Encompass -- founded by Bax,
company president Bill Tillson and private equity firm
Wasserstein & Co.-- with major facilities in the NY
metropolitan area and between Los Angeles and Atlanta.
The acquisition will require regulatory approvals under
Hart-Scott Rodino in the US, and the IDA in Singapore, the
transfer of certain FCC licenses and Ascent shareholder
approval, said Bax. The deal is expected to close in the first
quarter of 2011, he said.
The combined company will possess a client base consisting
of major media companies, cable and sports networks as well as
government entities. These include A&E Networks/Lifetime, Sony,
CBS, Disney/ABC, and the U.S. Department of Defense.
Ascent's video switch business will also allow Encompass to
expand its network with key customers such as CNN, CNBC,
Bloomberg, Thomson Reuters and the United Nations.
In 2008, former parent Discovery Holding Co [DISCV.UL],
controlled by Liberty Media Corp LINTA.O chairman Malone,
spun off Ascent Media as a publicly traded company. Malone
still holds a minority stake in Ascent while also serving as a
Ascent was at $30.99 per share at the close on Thursday.
The company has a current market capitalization of $443
million. As for other acquisition opportunities, Bax said
Encompass will be focused on integrating Ascent's global
content distribution as its primary responsibility.
Macquarie Capital advised Encompass on the transaction, and
is also providing financing with lender and shareholder
Tennenbaum Capital. Moelis & Co acted as financial adviser to
(Editing by Muralikumar Anantharaman)