Wes Simpson /
12.21.2011 12:00 AM
Telestream Acquired by Equity Investor
Dan Castles

NEVADA CITY, CALIF.—Telestream, a provider of video transcoding and digital media software solutions, has been acquired by Thoma Bravo, a private equity investment firm specializing in the software and service sectors. The transaction is expected to be completed in January 2012.

Dan Castles, Telestream CEO confirmed that there would be no changes in products, management, employee base or facilities. “Every product line, every brand will stay the same, and there will be no change in the management structure,” he said. In fact, “we expect to add people to our infrastructure for the short term.”

Telestream, which has 160 employees worldwide, launched in 1998 in Nevada City, Calif., focusing on video encoding and transcoding technology for broadcast and media companies. It has seen significant growth, particularly over the past six years, having acquired Popstream, a Swedish-based firm specializing in the mobile, Web TV, podcasting and streaming markets in 2006; in 2008, it purchased Vara Software, which specializes in Webcasting technology; and in 2010, it acquired Anystream, a provider of video production and management systems.

The successful integration of those acquisitions was one of the things that attracted Thoma Bravo to Telestream, according to Castles who added that all three of Telestream’s acquisitions were self-financed. This is Thoma Bravo’s first acquisition in the digital media space.

“They see us as their initial investment in what they term their ‘platform play,” Castles said. “One of the things that attracted them to us is that we have successfully acquired and integrated and nurtured three acquisitions in the last five years, so as a ‘platform play,’ they want to leverage our expertise and our position in the industry. So you’ll see acquisitions that will take place where Telestream will be the backbone/nerve center, and based on our track record of knowing how to do that, we will be working with other companies and integrating them into a broader play for the market.”

With 13 straight years of annual sales growth, Castles said Telestream is “very proud” of its cash flow but that the Thoma deal “allows our capital to go up a few zeroes.”

Look for a future acquisition in 2012, Castles predicted. “Every other year for the past six years, we’ve done an acquisition, I expect that will be true for 2012 as well.”

Thoma Bravo has offices in Chicago and San Francisco.

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Posted by: Anonymous
Sat, 12-22-2012 01:03 AM Report Comment
Or, for those big shareholders like me who have 60 shraes, the commission for selling on the market exceeds the 7 cents per share difference, so I'll wait for the cash on buyout. ... though sometimes brokers take pity and sell these Tech bubble remnants for no commission if you ask. 98% loss and counting.

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