Mr. MacMillan, CEO of Blue Ant.
Blue Ant Media Inc., a privately owned company controlled by Michael MacMillan, announced today that it has entered into a definitive agreement pursuant to which Blue Ant will go-public via a reverse take-over of Boat Rocker Media Inc. (“BRMI”) (TSX: BRMI).
“This is an opportunistic moment for Blue Ant to go public, paving the way for long-term value creation,” said Mr. MacMillan, CEO of Blue Ant. “We are confident that this transaction will unlock significant value for all shareholders. Through the combination of our public listing, a strengthened balance sheet, and significant net cash post-transaction, we believe that we are strategically positioned for profitable global growth, both organically and through M&A.”
Blue Ant is a global media company with interconnected operations spanning content creation and acquisition, rights management, international distribution, streaming, broadcasting, consumer shows, and connected TV ad sales. The Company was founded in 2011 by Mr. MacMillan, former Chair and CEO of Alliance Atlantis. Headquartered in Toronto, with a presence in Los Angeles, New York, Washington, London, Sydney, and Singapore, Blue Ant generated C$196 million in revenues in its most recent fiscal year ending August 31, 2024, a 16% increase year-over-year, and generated C$18 million in net income.
Pursuant to the Transaction, BRMI will acquire all of the outstanding shares of Blue Ant in exchange for subordinate voting shares of BRMI on the basis of an exchange ratio of 1.25 shares subordinate voting shares of BRMI (prior to the share consolidation noted below) for each share of Blue Ant (the “Exchange Ratio”). Based on a share price of C$2.25 per Blue Ant share and the Exchange Ratio, the implied consideration under the Transaction is C$1.80 per BRMI share (pre-consolidation), which is a 125% premium to the March 21, 2025 closing price of BRMI’s shares on the Toronto Stock Exchange (“TSX”). At closing of the transaction, the subordinate voting shares (“SVS”) of the company resulting from the RTO (the “Resulting Issuer”) are expected to be consolidated on a 10:1 basis.
Immediately following closing the Resulting Issuer will be renamed “Blue Ant Media Corporation” and, subject to regulatory approval, the Resulting Issuer’s shares will continue to be listed and trade on the TSX.
On closing of the RTO, the Resulting Issuer will inherit from BRMI three Canadian production companies: Insight Productions, Jam Filled Entertainment, and Proper Television, which collectively delivered C$118 million in revenue (based on unaudited results) in calendar 2024.
As part of the transaction, the Resulting Issuer will also receive substantial financial assets, including: (i) a minimum cash balance of C$25.5 million and normalized net working capital; (ii) US$11.6 million (approximately C$17 million) in cash from the monetization of BRMI’s ownership in The Initial Group; (iii) a C$18 million vendor takeback promissory note related to the management buyout of certain BRMI assets; and (iv) a value assurance payment of up to C$34.7 million based on the financial performance of the three production companies acquired for the year ending December 31, 2025.
Upon closing of the transaction, Blue Ant’s shareholders are expected to own approximately 73.5%, and BRMI’s shareholders approximately 26.5% of the Resulting Issuer’s SVS. Prior to completion of the RTO, Blue Ant intends to pursue a best-efforts agency offering of subscription receipts which are exchangeable for SVS of the Resulting Issuer, and Fairfax Financial Holdings Limited (“Fairfax”), a significant shareholder of Blue Ant, has agreed to support the offering through a C$20 million backstop commitment, which would reduce the above ownership percentages if completed. The company has entered into an agreement with Cormark Securities Inc. and National Bank Financial Inc. to act as co-lead agents in connection with the offering.
In addition to the backstop, Fairfax has entered into a number of agreements with Blue Ant and BRMI in support of the Transaction. Further details of the Transaction and the agreements with Fairfax are set out in Blue Ant’s presentation which will be available on SEDAR+ under BRMI’s profile.
Michael MacMillan will be appointed CEO of the Resulting Issuer upon close, and Brad Martin, the current chair of Blue Ant, will be appointed Chair of the Board of Directors of the Resulting Issuer. As Blue Ant owns certain Canadian broadcasting assets, in order to maintain Canadian control over the Resulting Issuer, and consistent with his existing position in Blue Ant, Michael MacMillan will have voting control of approximately 77.5% of the total votes (assuming there is no additional equity offering) over the Resulting Issuer including via ownership of 100% of the Resulting Issuer’s Multiple Voting Shares (“MVS”).
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