Cinedigm Corp (NASDAQ: CIDM) shares rose sharply early Friday after the company signed a definitive stock purchase agreement to acquire a 29% stake in Starrise Media.
CIDM has agreed to issue to the sellers, as consideration, a total of 54,850,103 shares of its Class A Common Stock, par value $0.001 per share. The Stock Purchase Agreement contains certain conditions to closing, including that the Company obtain approval of its stockholders, applicable lenders, and regulatory authorities, as applicable.
The Company expects to obtain the approval of the Share Acquisition by the Company’s majority stockholder and to mail a copy of an information statement relating thereto to its stockholders.
Said CEO Chris McGurk, "Now that we have signed the definitive agreement to acquire approximately 29% of Starrise, we will move rapidly to close this transaction while developing operational plans to increase Cinedigm’s presence and leverage in both the Chinese and North American markets.
"These are the two biggest entertainment markets in the world, with combined Film and Television revenues estimated to be approximately $180 billion U.S. in 2018. Following the close of this transaction, Cinedigm will be uniquely well positioned to grow our content distribution and OTT streaming businesses in both key territories."
Cinedigm has been a leader at the forefront of the digital transformation of content distribution. Adjusting to the rapidly transforming business needs of today’s entertainment landscape, Cinedigm remains a change-centric player focused on providing content, channels and services to the world’s largest media, technology and retail companies.
CIDM shares grew 13 cents, or 17.9%, to 85 cents
