ManiaTV Puts Itself Up for Sale
Facing a prolonged recession and a contracting advertising market, online television studio ManiaTV has put itself up for sale and expects to find a buyer by the end of this month, TelevisionWeek has learned.
The Web studio that landed advertisers including Coca-Cola and Doritos retained investment bank Updata Advisors late last year and has met with a few dozen potential buyers since the start of this year, said Peter Hoskins, the company’s CEO.
“We are talking to old media, new media, money people, distribution people, content people,” Mr. Hoskins said.
Although it’s a buyer’s market, Mr. Hoskins is eager to close a deal in the next few weeks. “The timing we have placed is very quick. We don’t want to be in a limbo state operationally and have everyone wondering if they need to look for a job, so it’s a very short window,” he said.
ManiaTV has received interest from multiple parties, he said. The goal is to finalize a buyer in the next two weeks and then spend March doing due diligence and hashing out terms, he said.
Given the current environment, ManiaTV is likely to be one of many online video players up for sale this year.
Venture capitalist Ross Levinsohn has predicted that 20% to 30% of the online video sector will disappear in the next two years. This year is likely to be a tough one for most startups; some, like ManiaTV, will seek early exits to mitigate any further damage from the downturn.
Mr. Hoskins said the Internet audience watches about 80 million minutes of videos on ManiaTV each month, a four-fold increase from a year ago. Despite the growth, the company laid off about 20 workers in the fall when the economy started to slow. Without a quick turnaround in sight, Mr. Hoskins made the decision to pursue a sale.
“Things are growing more slowly than they did a year or two ago for everyone in the industry, and there are not a lot of bullish projections that the economy will turn around in the next few weeks or month,” he said. “For companies like ours, it slows our growth and extends the exit for investors.”
Mr. Hoskins admitted it’s a tough time to sell, but he said the price tag for ManiaTV will not break the bank for the potential buyers. He declined to disclose the valuation for the company. “It’s a buyer’s market and it’s not the best time to be selling, but the people we are talking to are the types that can do deals independent of the economic climate,” he said.