Hollywood veteran Robert Halmi and his son, Robert, helped to build an entertainment firm back in the late 1970s, and it turned out to be a great success. In fact, by 1994 they sold it off to Hallmark Cards. Then, in 2006 Robert teamed up with Kelso, a private equity firm, to acquire Hallmark Entertainment, which was renamed RHI Entertainment.
This week, RHI Entertainment (NASDAQ: RHIE) has hit the public markets, pricing its IPO at $14 per share.
Essentially, RHI develops and distributes made-for-television content and mini-series. Last year, the company posted $232 million in revenues and adjusted EBITDA of $33 million.
A key asset is RHI's film library, which includes more than 1,000 titles (or 3,500 broadcast hours). No doubt, this is a big source of future cash flows. What's more, the company is expanding into new categories, such as video-on-demand and pay-per-view.
Some of RHI's customers include ABC, CBS (NYSE: CBS), GE's (NYSE: GE) NBC, Spike TV and USA Network. There are also deals with global broadcasters, such as Antena-3, M6, PROSIEBEN-SAT1, TF1, Seven Network and Sky.
Unfortunately, the IPO market has been rocky lately. As a result, RHI had a dicey start – with the stock price falling 3.57% to $13.50 in today's trading.
Tom Taulli is the author of various books, including The Complete M&A Handbook
