Last checked at 30 Jun 2011 16:10
30.06.11 Parallel Media Group PLC ("PMG" or the "Company") Launch of new smart media division
PMG, a leading sports media and promotion company, is pleased to announce the launch of a new smart media division through the indirect acquisition of 50% of Parallel Smart Media Limited ("PSM"), a joint venture with Talspace Inc, for a consideration of approximately £1m. Further details of the acquisition and the satisfaction of the consideration are set out below.
PSM has launched a new "smart media" viewing platform, developed using Talspace's proprietorial technology, which provides a step-change in the way that sports, entertainment and lifestyle media can be delivered. The new viewing platform offers consumers the ability to dynamically stream multiple live and video-on-demand HD camera feeds across a global distribution network to all major `smart' device platforms including Apple's IOS, Android, Windows and Blackberry Tablet OS ("Apps").
PSM intends to combine the smart media viewing platform technology (to which Talspace has attributed a value of US$5m) with the experience and contact base of PMG to develop Apps that enable consumers to interact and engage with their favourite sports, athletes and brands. Following the successful trial at the recent Ballantine's Championship, PSM has identified numerous sports federations and athletes who, through the deployment of the PSM viewing platform, will be able to create their own media channel and offer a level of access not currently available elsewhere. PSM has exclusive worldwide rights for deployment of the technology other than in Korea and Japan where it has non-exclusive rights.
PSM's low-overhead, flexible and scalable business model is well-placed to complement the existing PMG group business through combining its more traditional sports marketing sponsorship strategy with PSM's advanced digital smart media solutions. For consumer brands, the viewing platform opens B2B and B2C communication channels and delivers key consultative data on geo-location and audience specific on and off line marketing activity.
PSM's business plan is based on a number of revenue streams:-
* provision of bespoke viewing platforms for events, federations and athletes; * consultancy fees for digital strategy; and * share of download and subscriber revenues after recoupment of costs.
David Ciclitira, Chairman of PMG commented: "I ï¬rmly believe that we should embrace the opportunities for user interaction in the sporting industry, with PSM using golf to lead the way in allowing fans to control their own viewing experience and encouraging the technological revolution happening in the world of sport. We expect PSM to contribute a significant proportion of PMG's revenues by 2012."
As mentioned above, PSM successfully trialled the smart media viewing platform at the Ballantine's Championship earlier this year. It provided the user with a unique and highly personal experience of the golf tournament combining the bene ï¬ts of viewing the very best of ï¬lmed tournament coverage, with the atmosphere of being amongst the galleries. Ballantine's Championship debutant and US Ryder Cup player Dustin Johnson said "Parallel Smart Media's Ballantine's Championship application takes golf viewing to a new level. It's a must-have for every fan who really wants to follow the action."
The board of PSM comprises David Ciclitira and Charlie Wale (PMG), Chinui Kim, (Talspace) and Alex Bang (Chosun Media). Alex Bang was nominated by Talspace.
Details of the acquisition and related party transaction
PMG has agreed to acquire the whole of the issued share capital of Parallel Media Korea Limited ("PMK"). PMK owns 50% of the issued share capital of PSM. PMG has also agreed to acquire the whole of the issued share capital of Parallel Media (Africa) Limited ("PMA") which is intended to be used to roll out the Apps in South Africa. The vendors of the issued shares of PMK and of PMA are Luna Trading Limited (a company controlled by David Ciclitira) and Stewart Mison who hold the shares in the proportions of 99% and 1% respectively. The consideration for the acquisition of PMK and PMA is to be satisfied by (i) PMG agreeing to waive repayment of £606,568 of amounts due in respect of the costs of developing the business of PSM and (ii) the allotment of 1,153,746 new ordinary shares of PMG at a price of 35p per share, representing expenditure incurred to date on the PSM project by Luna Trading Limited (a company controlled by David Ciclitira) ("the consideration shares"). The allotment of the consideration shares, which will rank pari passu with the existing ordinary shares, is conditional on the passing of resolutions renewing PMG's share authorities at the Company's forthcoming Annual General Meeting.
The acquisition of PMK and of PMA is deemed to be a related party transaction under the AIM Rules for Companies. The directors of PMG, other than David Cicilitira, Serena Ciclitira and Stewart Mison, having consulted with the Company's Nominated Adviser, Northland Capital Partners Limited, consider that the terms of the acquisition of PMK and PMA are fair and reasonable so far as the shareholders of the Company are concerned.
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For further information, please contact:
Parallel Media Group 020 7225 2000
David Ciclitira 0776 605 8566
Charles Wale 0792 001 7360
Northland Capital Partners 020 7796 8800
Luke Cairns, Edward Hutton
Bishopsgate Communications
Laura Stevens, Deepali Schneider, Natalie Quinn 020 7562 3350
pmg@bishopsgatecommunications.com
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