Crackle streaming service owner Chicken Soup for the Soul Entertainment has completed its acquisiton of DVD-focused entertainment firm Redbox to expand its footprint in free ad-supported streaming video.
The deal, which will give Chicken Soup stockholders a 76.5 percent ownership of the combined company, and Redbox stockholders holding the remaining 23.5 percent, is the result of a $375 million all-stock merger that includes the assumption of Redbox’s $325 million debt and $50 million in Chicken Soup for the Soul stock.
Redbox shareholders approved the merger on August 9. Existing Redbox shareholders will receive a fixed exchange ratio of 0.087 of a share of class A common stock of Chicken Soup per Redbox share.
Chicken Soup expects $40 million in synergies from the merger, and overall revenue from the combined companies to triple to $500 million annually. Chicken Soup will also add around 11,000 movies and TV series to a 40,000-title streaming catalog to drive through a bolstered 145 free ad-supported streaming TV platform.
In addition, Redbox’s 36,000 kiosks will expand Chicken Soup’s touchpoints for advertisers beyond free streaming channels and allow added promotion for original movies. And former Redbox CEO Galen C. Smith becomes executive vice chairman of Redbox and Chicken Soup, while Jonathan Katz is named president of Chicken Soup.