Cinedigm Corp is selling back its Hollywood Software unit to an investor group led by David Gajda, one of the software company’s co-founders. Studios and exhibitors use Hollywood’s products to manage film distribution and operate theaters. The deal, an all-cash transaction for shares of Hollywood, is effective immediately. Cinedigm CEO and Chairman Chris McGurk said the selloff makes sense because of Cinedigm’s shifting focus and resulting potential competitive conflicts that might have hobbled Hollywood’s growth potential.
“Given Cinedigm’s headlong pivot into entertainment distribution, having a software company — one that often serves our competitors — no longer made sense,” said McGurk. “Advancing Hollywood Software’s growth as a stand-alone business, with Dave at the helm, makes abundantly more sense.”
Cinedigm, under its previous name, AccessIT, bought Hollywood Software in 2003. The Theatrical Distribution System software is used by more than 30 companies, including 20th Century Fox, Universal and Lionsgate. The Digital Cinema Theater Management System software is used for 12,000 screens. Gajda will serve as Executive Chairman of the spun-off company.
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