Announcement • Aug 02
Blue Ant Media Inc. completed the acquisition of Boat Rocker Media Inc. (TSX:BRMI) from David Fortier, Ivan Schneeberg, John Young ("IDJCo"), Fairfax Financial Holdings Limited (TSX:FFH) and others for approximately CAD 130 million in a reverse merger transaction.
Blue Ant Media Inc. entered into a definitive agreement to acquire Boat Rocker Media Inc. (TSX:BRMI) from David Fortier, Ivan Schneeberg, John Young ("IDJCo"), Fairfax Financial Holdings Limited (TSX:FFH) and others for approximately CAD 130 million in a reverse merger transaction on March 24, 2025. Pursuant to the Transaction, BRMI will acquire all of the outstanding shares of Blue Ant in exchange for subordinate voting shares of BRMI on the basis of an exchange ratio of 1.25 shares subordinate voting shares of BRMI (prior to the share consolidation noted below) for each share of Blue Ant (the “Exchange Ratio”). Based on a share price of CAD 2.25 per Blue Ant share and the Exchange Ratio, the implied consideration under the Transaction is CAD 1.80 per BRMI share (pre-consolidation), which is a 125% premium to the March 21, 2025 closing price of BRMI’s shares on the Toronto Stock Exchange (“TSX”). At closing of the transaction, the subordinate voting shares (“SVS”) of the company resulting from the RTO (the “Resulting Issuer”) are expected to be consolidated on a 10:1 basis. Immediately following closing the Resulting Issuer will be renamed “Blue Ant Media Corporation” and, subject to regulatory approval, the Resulting Issuer’s shares will continue to be listed and trade on the TSX. On closing of the RTO, the Resulting Issuer will inherit from BRMI three Canadian production companies: Insight Productions, Jam Filled Entertainment, and Proper Television, which collectively delivered CAD 118 million in revenue (based on unaudited results) in calendar 2024. As part of the transaction, the Resulting Issuer will also receive substantial financial assets, including: (i) a minimum cash balance of CAD 25.5 million and normalized net working capital; (ii) approximately CAD 17 million in cash from the monetization of BRMI’s ownership in The Initial Group; (iii) a CAD 18 million vendor takeback promissory note related to the management buyout of certain BRMI assets; and (iv) a value assurance payment of up to CAD 34.7 million based on the financial performance of the three production companies acquired for the year ending December 31, 2025. Upon closing of the transaction, Blue Ant’s shareholders are expected to own approximately 73.5%, and BRMI’s shareholders approximately 26.5% of the Resulting Issuer’s SVS. Prior to completion of the RTO, Blue Ant intends to pursue a best-efforts agency offering of subscription receipts which are exchangeable for SVS of the Resulting Issuer, and Fairfax Financial Holdings Limited (“Fairfax”), a significant shareholder of Blue Ant, has agreed to support the offering through a CAD 20 million backstop commitment, which would reduce the above ownership percentages if completed. The company has entered into an agreement with Cormark Securities Inc. and National Bank Financial Inc. to act as co-lead agents in connection with the offering. In addition to the backstop, Fairfax has entered into a number of agreements with Blue Ant and BRMI in support of the Transaction. Michael MacMillan will be appointed CEO of the Resulting Issuer upon close, and Brad Martin, the current chair of Blue Ant, will be appointed Chair of the Board of Directors of the Resulting Issuer. The current Board of BRMI (other than Ellis Jacob), as well as IDJCo’s principals, will resign on closing of the RTO. As Blue Ant owns certain Canadian broadcasting assets, in order to maintain Canadian control over the Resulting Issuer, and consistent with his existing position in Blue Ant, Michael MacMillan will have voting control of approximately 77.5% of the total votes (assuming there is no additional equity offering) over the Resulting Issuer including via ownership of 100% of the Resulting Issuer’s Multiple Voting Shares (“MVS”). As of June 17, 2025 Boat Rocker Media shareholders has approved the transaction.
The Transaction is subject to the receipt of all required approvals, including those of the shareholders of Blue Ant and Boat Rocker Media, the Boat Rocker Studios acquisition and Fairfax's acquisition of BRMI's minority interest in TIG, among other approvals, will also be required, excluding Fairfax and/or IDJCo's principals, as applicable, as all three constitute related party transactions. The Transaction is subject to customary representations, warranties and covenants, as well as various closing conditions, including the receipt of TSX, CRTC and Competition Act approvals, BRMI's satisfaction at closing of certain minimum cash and working capital thresholds, and the receipt of certain third-party approvals. The Transaction is currently expected to close in early June, 2025. The Board (with interested directors abstaining), acting on the unanimous recommendation of the Special Committee, has unanimously approved the Transaction.
Cormark acted as financial advisor to Blue Ant. Scotiabank acted as independent valuator and exclusive financial advisor and fairness opinion provider for the Special Committee. Stikeman Elliott LLP acted as legal advisor to BRMI and Goodmans LLP acted as independent legal advisor for the Special Committee. Bennett Jones LLP acted as legal advisor to Blue Ant. Torys LLP acted as legal advisor to Fairfax.
Blue Ant Media Inc. completed the acquisition of Boat Rocker Media Inc. (TSX:BRMI) from David Fortier, Ivan Schneeberg, John Young ("IDJCo"), Fairfax Financial Holdings Limited (TSX:FFH) and others for approximately CAD 130 million in a reverse merger transaction on August 1, 2025.
