British TV producer Boomerang Plus Plc (LON:BOOM) said on Wednesday it would be taken over by its management via a cash offer of £0.77 ($1.21/€0.96) per share agreed by the firm’s independent directors.
The bid, valuing Boomerang at around £7.1m in total, has been made through Boom Pictures Ltd, a new company backed by Boomerang managers including CEO Huw Eurig Davies, finance director Mark Fenwick and executive director Gareth Rees, as well as by British TV producer Lorraine Heggessey and private equity firm LDC, part of Lloyds Banking Group Plc (LON:LLOY).
After the offer for Boomerang become fully-unconditional, Boom Pictures will be owned by LDC funds, Heggessey and Boomerang managers.
Commenting on the agreement, Boomerang’s chairman Richard Huntingford said the proposal will allow shareholders to receive a substantial cash premium, while giving the management and employees a strong platform for growth through organic projects and acquisitions in the coming years.
LDC, which plans to invest £200m in the expanding domestic TV production sector over the next two years, expects the management buyout deal to drive significant growth at Boomerang, managing director Daniel Sasaki said. He added that LDC will use its resources, skills and sector track record to support the management in its efforts to step up the development of the firm.
The new Boom Pictures aims to produce high-quality content and establish good ties with broadcasters, advertisers and talents active in multiple geographies. It wants to build itself as an attractive partner for small independent TV companies who need resources and expertise to achieve their full potential, it said.
The deal will be financed with equity and loan notes as well as cash resources of Lloyds Banking Group.
The success of the offer is subject to securing over 90% in Boomerang by 25 July. At reaching the needed acceptance level, Boom Pictures will buy the rest of Boomerang compulsorily and take the company private. The buyer said it had already secured commitments from Boomerang shareholders controlling around 80.9% in the company accounting for around 74.2% of the votes.
Boomerang is advised by finnCap.