C21MEDIA is reporting that Entertainment Rights is now going into administration, selling its U.K. and U.S. subsidiaries to Boomerang Media. Boomerang is a U.S.-based group founded by the founders of its subsidiary, Classic Media.
ER said in a statement, "Despite the financial support of the group's lender, the group has been unable to achieve a solvent restructuring of the company," and has appointed administrators Nicholas Guy Edwards and Carlton Malcolm Siddle of Deloitte, effective immediately.
Over the last six months, the company has had an asset sale and job losses in an attempt to control and reduce a debt that reached $183 million, mostly acquired after it took over Classic media.
Boomerang, under the management of Eric Ellenbogen and John Engelman (who also founded Classic Media), has purchased the shares of ER subsidiaries Entertainment Rights, Classic Media and Big Idea with financial backing from Chicago-based private equity group GTCR. Besides getting ER's classic properties, including CASPER THE FRIENDLY GHOST, THE LONE RANGER, RUDOLPH THE RED-NOSED REINDEER, HE-MAN AND THE MASTERS OF THE UNIVERSE and SHE-RA, the partnership with GTCR will include a $200 million investment into ER's franchises.
C21MEDIA previously reported that potential buyers included Chorion, private investment firm 3i, Hit Ent. and De Agostini.
"John and Eric have exceptional track records in entertainment, not to mention a history with most of the company's leading brands. Backed by GTCR's successful history of building industry leaders, the company is poised for its next phase of growth," according to ER's CEO and President Deborah Dugan.
The sale will allow "the ongoing activities of the group's trading subsidiaries, allowing the former businesses of Entertainment Rights to survive under new ownership. The new owners have indicated their intention to invest in the business to further develop its strong portfolio of intellectual property," ER said in a statement.
