By Lisa Kerner
Charlotte, N.C., Dec. 7 - Macrovision Corp. agreed to acquire Gemstar-TV Guide International, Inc. in a cash and stock transaction valued at some $2.8 billion.
Gemstar stockholders will receive $6.35 in cash or 0.2548 of a share of common stock in a new holding company that will own both Gemstar and Macrovision.
Total cash consideration to Gemstar stockholders will not exceed $1.55 billion, according to a company news release.
News Corp., which owns approximately 41% of Gemstar's common stock, has agreed to vote in favor of the deal.
Macrovision stockholders will own one share in the new company for each share of Macrovision common stock held. In addition, Macrovision shareholders will own about 53% of the combined company.
Both companies' boards of directors have unanimously approved the transaction, which is expected to close early in the second quarter of 2008 at the latest.
Macrovision chief executive officer and president Fred Amoroso will be the president and CEO of the combined company. Gemstar CEO Rich Battista and CFO Bedi Singh will leave the company once the transaction closes.
The merger is expected to ease current interoperability issues between devices that deliver digital media. It addition, it will make available libraries of commercial and personal protected content accessible on numerous devices.
"We believe that the combined entity, with its complementary technologies, customers and global presence has the potential to redefine the consumer entertainment experience and drive significant additional stockholder value," Battista said in the release.
Macrovision was advised by JPMorgan, while UBS Investment Bank advised Gemstar.
Gemstar is a media and entertainment company located in Los Angeles.
Macrovision provides digital lifecycle management solutions, including anti-piracy and content protection solutions. The company is based in Santa Clara, Calif.
| Acquirer: | Macrovision Corp.
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| Target: | Gemstar-TV Guide International, Inc.
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| Announcement date: | Dec. 7
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| Transaction total: | $2.8 billion
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| Price per share: | $6.35 or 0.2548 of a share in the new holding company
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| Expected closing: | Second quarter of 2008
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| Stock price of target: | Nasdaq: GMST: $5.98 on Dec. 6
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