Sony Pictures Television is to relaunch Crackle, its ad-supported streaming service, as part of a newly minted joint venture with feel-good content prodco and distributor Chicken Soup for the Soul (CSS) Entertainment.
Under terms of the deal, CSS Entertainment will hold a majority interest in Crackle Plus, the rebooted streaming venture that will also encompass CSS Entertainment’s portfolio of AVOD networks: Popcornflix, Truli, Popcornflix Kids, Popcornflix Comedy, Frightpix, and Espanolflix, as well as the SVOD platform Pivotshare.
Sony, in turn, will receive four million five-year warrants to purchase Class A common stock of CSS Entertainment at various prices. The company will also contribute Crackle’s U.S. assets, its monthly active users and its advertising business to the joint venture, as well as technological back-end support from Sony’s New Media Services. Sony Pictures Television will also license its content library to Crackle Plus.
Additional financial details of the transaction were not disclosed.
Crackle Plus will serve as one of the largest AVOD platforms in the U.S. with access to more than 38,500 hours of programming that will entertain a combined audience of nearly 10 million monthly active users across its platform. The service is expected to stream 1.3-plus billion minutes per month.
Ladenburg Thalmann & Co. Inc., a subsidiary of Ladenburg Thalmann Financial Services Inc., acted as sole advisor to CSS Entertainment in this transaction. Moelis & Company LLC acted as exclusive financial advisor to SPT in connection with the transaction.
“Crackle is a valuable asset and we feel confident it will thrive and grow in this new environment with CSS Entertainment,” said SPT chairman Mike Hopkins in a statement. “We were drawn to CSS Entertainment as our partner in this venture because of its aggressive, entrepreneurial approach,” said Hopkins. “The CSS Entertainment team have the enthusiasm and strong business acumen to ensure Crackle Plus is poised to maximize the growing opportunities in the AVOD marketplace.”
“This transaction positions CSS Entertainment as a leader in the high-growth AVOD business,” added William J. Rouhana Jr., chairman and chief executive officer of CSS Entertainment. “Creating a new platform that brings together CSS Entertainment’s VOD assets with SPT’s Crackle brand and AVOD assets, establishes a compelling offering for viewers and advertisers. Consistent with our business plan, we plan to build Crackle Plus aggressively and profitably through organic growth and, potentially, acquisitions.”