Harry Sloan and Jeff Sagansky's Global Eagle Acquisitions has formed the single largest entertainment platform for airplaines through a pair of acquisitions estimated at $430 million, the company announced on Thursday.
For that nine-figure sum, Global Eagle has acquired Row 44, a leading satellite-based broadband service for the airline industry, and a majority stake in Advanced Inflight Alliance (AIA), a leading supplier of games, movies and entertainment for airlines. Row 44's entertainment connectivity system is installed in more than 400 aircraft operating worldwide while AIA serves more than 130 airlines worldwide with games, movies and applications.
The combined company will be renamed Global Eagle Entertainment Inc. Including the roughly $190 million raised through Global Eagle's IPO last May, the new enterprise is valued at close to $630 million.
"By combining AIA's access to the installed inflight entertainment market with Row 44's wi-fi to mobile device capability, Global Eagle has potential access to 100% of the airline passenger experience, creating an addressable market as large as the global airline industry," Sloan, Global Eagle's Chairman and CEO, said in a statement. "This is exactly the kind of worldwide digital media opportunity we've been seeking for Global Eagle since our IPO."
Sloan (above left), the former head of MGM, and Sagansky (above right), a veteran media executive, formed Global Eagle Acquisitions as a special purpose acquisition company. It raised $190 million in its IPO last May and set out to acquire media companies that could succeed in a shifting economic landscape.
The combined company will own 100 percent of Row 44 and 86 percent of AIA. It will list its shares on the Nasdaq as "ENT." Global Eagle will purchase the AIA shares from PAR Investment Partners, which also owns many of Row 44's shares.
Edward L Shapiro, a partner at PAR and chairman of the board of Row 44 will become Chairman of Global Eagle.
"Row 44 and AIA are leaders in their respective industries and have highly complementary products and customer bases," Shapiro said in a statement. "With this transaction, not only will the two companies be able to enhance their offerings, but they will gain access to additional capital and relevant entertainment industry experience."
Both of the companies will retain their senior management teams under new ownership.