Case study: Sparrowhawk Media
Multichannel TV is one of the fastest growing media markets in the world. In Europe alone, subscriber numbers for multichannel TV are expected to treble and advertising revenues are predicted to grow by 15% per annum over the next five years.
3i and Providence Equity Partners recently acquired Sparrowhawk Media, a leading multichannel pay TV provider, in a deal valued at Û185m. The company operates the Hallmark Channel, a cable network specialising in family-orientated programming and operating in over 150 countries. It also owns a library of over 580 films and mini-series, plus a state-of-the-art broadcast facility based in Denver, Colorado, USA.
3i is working with David Elstein, a former CEO of Channel 5, who will chair the business and who is also chairman of 3i portfolio company Screen Digest. Elstein had developed a close relationship with the management team and vendor and considered 3i an ideal investment partner for the business. 3i’s Crevan O’Grady explains, “3i have
known David for some time and we were delighted to join forces with him again in acquiring Sparrowhawk Media’s international businesses. 3i’s strength in media, appetite for the broadcast segment and our international network proved a good match for the scope and ambition David and the management have for the business.”
Sparrowhawk Media intends to become a platform for future acquisitions and will be able to take advantage of 3i’s international network of contacts. 3i will also source and fund potential acquisitions.
“To stay ahead of the curve you need great market access and a talented group of investors with the financial fire power to deliver,” Elstein explains. “With 3i’s track record in the media space we felt confident that they would help us close the complex and lengthy set of negotiations involved in this transaction.”