Chicken Soup for the Soul Entertainment Buys Global SVOD Service

Chicken Soup for the Soul (CSS) Entertainment has inked a definitive deal to acquire Pivotshare, a global SVOD service, for $4.35 million.

Pivotshare features multiple online channels comprising 28,000 hours of programming that spans such categories as music, sports, religion, arts and culture, lifestyle and family. The network has approximately 25,000 paid subscriptions. This acquisition will mark the launch of CSS Entertainment’s SVOD business.

“This accretive acquisition of Pivotshare launches us into the subscription VOD space, significantly accelerating our business plan,” remarked William J. Rouhana, Jr., chairman and CEO of CSS Entertainment. “This multi-channel online network comes with pre-existing content, much of which fits with the Chicken Soup for the Soul brand.”

“We are thrilled to become part of the Chicken Soup for the Soul Entertainment ecosystem,” noted Adam Mosam, founder of Pivotshare. “CSS Entertainment is strategically capitalizing on disruption in the entertainment industry, and Pivotshare will help accelerate the company’s growth and presence in the subscription-based VOD business while also bringing a top technology team to the company.”

“After our recent perpetual preferred stock offering, we decided to offer our Series A preferred shares as an acquisition currency to the Pivotshare shareholders, and they agreed to accept $3.35 million of the $4.35 million purchase price (excluding closing costs) in the form of our perpetual preferred stock,” stated Scott W. Seaton, vice chairman at CSS Entertainment. “The balance of the purchase price is $257,000 in cash and 74,235 shares of CSS Entertainment common.

“Pivotshare is expected to generate approximately $1 million per year in cost savings for CSS Entertainment, which is a 23 percent return on our investment annually. Using preferred stock as an acquisition currency with a 9.75 percent coupon and focusing on accretive acquisitions like this one will substantially and rapidly grow our business while adding to our cash flow.”

“The acquisition of Pivotshare secures CSS Entertainment’s operations in the subscription VOD space earlier than projected, and allows us to deploy our already owned content libraries as subscription VOD services quickly and at little to no cost,” added Rouhana.