Entertainment company CKx (NASDAQ:CKXE), which owns the rights to both the American Idol and So You Think You Can Dance TV series, has agreed to be acquired by private equity firm Apollo Global Management in a $511 million deal.
Under the terms of the agreement, which will see CKx de-list from the Nasdaq exchange, CKx stockholders will receive US$5.50 in cash for each share they hold, a 25% premium to the closing price on Monday.
"We look forward to working with Apollo, a growth-oriented investor who has a successful history of investing in the media and entertainment sector and one that the Board and management team are confident will serve as a strong steward for the company’s brands going forward," said chairman and CEO Michael G. Ferrel.
The transaction allows CKx stockholders to realize significant value from their investment in the company, Ferrel continued.
The deal, which has already been approved by CKx's board, has debt financing in place from Goldman Sachs.
Apollo said it has also entered into lock-up agreements with two of CKx's major shareholders, including the Promenade Trust, the sole beneficiary of which is Lisa Marie Presley, and Robert F.X. Sillerman.
CKx also owns the rights to the name and image of Elvis Presley and Muhammad Ali.
Apollo, with offices in New York, Los Angeles, London, Frankfurt, Luxembourg, Singapore, Mumbai and Hong Kong, had assets under management of $68 billion at year-end 2010.
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