DHX Media still looking for acquisitions following Disney deal
December 04, 2013 | Chris Powell | Comments
DHX Media’s entry into Canadian broadcast with last week’s acquisition of four TV channels from Bell Media is a natural step in the evolution of the seven-year-old company, says its president and COO Steven DeNure.
Established in 2006 following the merger of DeNure’s Decode Entertainment with Halifax Film Company (established by current DHX CEO Michael Donovan), Halifax-based DHX is one of the leading independents in the children’s entertainment space.
Prior to the Bell Media transaction, DHX operated in the content creation, distribution and merchandising business, boasting a library of more than 9,500 hours of kids content spanning an estimated 280 titles. Many of the titles are marquee brands in the children’s space, including Inspector Gadget (which the company is about to re-launch), Caillou and Teletubbies.
The recent acquisition of the Family Channel Business, including the Family Channel, Disney XD and Disney Junior (English and French) in an all-cash deal valued at $170 million complements its existing business units, said DeNure.
DHX has been growing steadily through a combination of organic growth and acquisitions. It currently has a market capitalization of about $500 million and employs an estimated 210 people at offices in Halifax, Toronto and Vancouver as well as its international offices in L.A., London, Paris, Barcelona, Milan, Munich and Amsterdam.
DeNure said the company remains in growth mode, but was non-committal when asked if future acquisitions might involve other broadcast entities. “We’re focused on the kids business, and when quality assets come up in this business, we’re a buyer,” he said. “We look at everything for sale.”
In September, DHX acquired Ragdoll Worldwide – owner of Teletubbies and In the Night Garden – from BBC Worldwide and a group including founder Anne Wood for $28.4 million. In October 2012 it acquired Cookie Jar Entertainment, owner of the Care Bears franchise, for $112 million.
“We’ve had good momentum on the acquisition front,” said DeNure. “We’re focused on growth.”
The acquisition of the ad-supported Disney XD service (the other services are all commercial-free) moves DHX into the world of advertising sales, although DeNure said the company plans to bring aboard some sales staff from the former Bell properties to help in the transition – all contingent on CRTC approval of the deal.
While the addition of the Family Channel assets provides another distribution platform for its program library, DeNure said it wasn’t the primary motivation for the deal. “That may be a benefit, but it’s not a key driver in us acquiring the channels,” he said.
The channels will continue to operate with a degree of autonomy he said. “We value the expertise and the history and the management there,” he said. “We know the team well, so it would be our intention to continue.” He said that it is too early to comment on would transition to DHX.