FilmOn parent sets IPO price at $8, plans to continue buying 'complementary' OTT assets

(Image source: Media Networks)

The parent company of FilmOn, the linear streaming service that has doggedly hung on to the idea of free live television over the internet even as competitor Aereo fell and Hulu packed up its free service, is about to go public. Alki David-owned FOTV Media Networks has filed a registration statement with the SEC and expects to make an initial public offering (IPO) in September.

The company on Thursday announced that it will offer 2.5 million to 3.75 million shares of common stock, priced at $8 per share. The offering is underwritten by Monarch Bay Securities, LLC, and Network 1 Financial Securities, LLC.

FOTV said in July that it hopes to raise $34.5 million in the offering.

Money raised from the IPO will go toward FOTV’s content acquisition efforts and its ongoing strategy to acquire “complementary businesses,” such as its recent pickup of transactional VOD service CinemaNow and its acquisition of OVGuide. The company said in its filing that it is considering a number of other potential acquisitions, including “OTT hardware distribution companies, 360° panoramic video camera solutions, video streaming support device manufacturers, specialized advertising networks and live performance venues for the staging of hologram projection programs and sales of related merchandise to live audiences.” 

Going public is an interesting move for FOTV. The most obvious explanation for the IPO is that FilmOn needs cash, but the amount to be raised seems fairly small, an article in The Street mused earlier this summer.

According to the company’s financials, filed with the IPO registration, FOTV Media brought in revenues of $3.5 million and $35.5 million in assets in the first quarter of 2016, and posted a net loss of $6.03 million.

David himself is a billionaire from a shipping magnate family. Back in 2008, when he placed on the UK’s Plus and Germany’s Neumarket exchanges he told that “The reason I am doing is I am fed up with being ripped off by distributors,” adding that he wanted to appeal to “public investors and not the institutions.”

Separate company FilmOn X, which isn’t part of FOTV Media Networks right now, is still sparring with major U.S. broadcasters in court, trying to gain the right to obtain licenses to retransmit content from Fox, ABC, CBS and NBC.

In the meantime FOTV has built a web-based streaming site that features licensed or free-to-all content from a number of digital media outlets, and added a few goodies like holographic concert performances and virtual reality streams via its Hologram USA subsidiary.

For more:
- see this TheStreet article

Related articles:
As Hulu turns over AVOD service to Yahoo, FilmOn X battles broadcaster appeal
FilmOn acquires OVGuide to pull together discovery of online content
FilmOn acquires CinemaNow, pushes into $2B TVOD market