Jeff Sagansky and Harry Sloan are launching yet another special purpose acquisition company and this time are looking for something in the digital space for possible business deals. Dubbed Double Eagle, the company announced an initial public offering priced at $500M. This follows on the heels of what the businessmen have done twice already in the past and both times have led to big acquisitions.
In 2011, Sagansky and Sloan launched Global Eagle, a special purpose acquisition company which raised $190M in its initial public offering, and then ended up buying two companies — satellite connectivity firm Row 44 and content company Advanced Inflight Alliance –that created one big inflight entertainment business in a deal valued at $430M. In 2013, they collaborated on Silver Eagle and raised another $325M and then contributed $273M to the purchase of Mumbai-based Videocon d2h, India’s fastest-growing direct-to-home pay-TV provider — 500 digital TV channels and other video and audio services to about 13M subscribers via direct satellite feeds. They listed the company publicly in India.
Double Eagle is offering 50,000,000 units at $10.00 per to investors. This time around, they are hoping to capitalize on the worldwide transformation that is going on in the digital space. The way it works is they raise the money, they find a target of acquisition and then, according to Sagansky, “Once we do, we go back to the investors and they have to stay in or redeem their shares.”
So far, they have been able to stay relatively ahead of the curve. For instance, when they came in on Videocon d2h, the company was growing but yet to saturate the market. They ended up taking that public in India. In that instance, all investors stayed in Videocon and have enjoyed a steady growth rate. It is the first satellite TV service in India to roll out the 4K format and is the only pay-TV operator which runs its own service centers. According to the SEC filing for the quarter ending June 30, 2015, Videocon’s gross subscriber base now stands at 13.7M with a net subscriber base of 10.64M.
The interesting thing about the India transaction is that while Sagansky was working as an executive at Sony Pictures Entertainment, he was overseeing the growth of Sony channels in India. Likewise, Sloan, who was a former executive at MGM Studios, oversaw the MGM channel in India.
With Double Eagle, they are “still in the early innings” as Sagansky puts it and “we don’t know the company yet” but he said they are thinking in terms of direct-to-the-consumer media/telecom as it relates to media. That is also in the wheelhouse of their expertise as it is with Double Eagle’s independent directors — James M McNamara, Dennis A Miller and Frederic Rosen who already have “severally committed, pursuant to a written agreement, to purchase an aggregate of 19,500,000 private placement warrants.”
Deutsche Bank Securities and BofA Merrill Lynch are handling with Stern Agee CRT and I-Bankers serving as co-managers.
Here is the announcement which goes into details of the NASDAQ listing:
Double Eagle Acquisition Corp. (Nasdaq: EAGLU), the third acquisition vehicle led by media executive Jeff Sagansky, today announced the pricing of a $500 million initial public offering of 50,000,000 units at $10.00 per unit, including $20 million, or 2,000,000 units, to be sold pursuant to the underwriters’ partial exercise of their over-allotment option. Each unit issued in the initial public offering consists of one Class A ordinary share and one warrant to purchase one half of one Class A ordinary share at an exercise price of $5.75 per half share ($11.50 per full share). The units are listed on the NASDAQ Capital Market and trade under the ticker symbol “EAGLU.” Once the securities comprising the units begin separate trading, the Class A ordinary shares and warrants are expected to be listed on the NASDAQ Capital Market under the symbols “EAGL” and “EAGLW,” respectively.
Double Eagle was formed for the purpose of combining with one or more businesses through a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination. Its efforts in identifying a prospective target business will be focused on, but not limited to, the media and entertainment industries. Double Eagle’s sponsor is Double Eagle Acquisition LLC, of which Mr. Sagansky is the Managing Member.
Joining him in the management of the company is Chief Financial Officer James Graf, who served in that capacity for Mr. Sagansky’s two prior public acquisition vehicles, and Eli Baker, who joins the team as Vice President, General Counsel and Secretary, and was a director of one of Mr. Sagansky’s prior public acquisition vehicles.
Harry E. Sloan, who co-led the two prior public acquisition vehicles with Mr. Sagansky, is a major founding investor in Double Eagle alongside the sponsor. Double Eagle’s sponsor, Mr. Sloan and its independent directors, James M. McNamara, Dennis A. Miller and Fredric D. Rosen, have severally committed, pursuant to a written agreement, to purchase an aggregate of 19,500,000 private placement warrants, each exercisable to purchase one-half of one Class A ordinary share at $5.75 per one-half share, at a price of $0.50 per warrant, or $9,750,000 in the aggregate, in a private placement that will occur simultaneously with the closing of this offering.
Deutsche Bank Securities and BofA Merrill Lynch acted as joint book runners for the offering, with Sterne Agee CRT and I-Bankers serving as co-managers. The offering is being made only by means of a prospectus. When available, copies of the prospectus may be obtained from Deutsche Bank Securities, Attn: Prospectus Group, 60 Wall Street, New York, NY 10005 … or by emailing prospectus.CPDG@db.com; or from BofA Merrill Lynch, Attn: Prospectus Department, 222 Broadway, New York, NY 10038 … or by emailing email@example.com.
A registration statement relating to these securities has been declared effective by the Securities and Exchange Commission on September 10, 2015.