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Redbox Goes Public

Redbox
(Image credit: Redbox)

NEW YORK & OAKBROOK TERRACE, Ill.—Redbox has announced that it has completed its business combination with Seaport Global Acquisition Corp., a publicly traded special purpose acquisition company (SPAC). The merger will allow “Redbox Entertainment Inc.” common stock and warrants to begin trading on NASDAQ on Monday, October 25, 2021, under the ticker symbols “RDBX and “RDBXW,” 

Redbook had announced earlier this year that it would go public via a SPAC. 

“Today marks the beginning of Redbox’s next chapter,” said Galen Smith, CEO of Redbox. “Since revolutionizing the way Americans rent movies nearly two decades ago, Redbox has continuously evolved and expanded our reach – all while offering our millions of loyal customers exceptional value in home entertainment. Today, we are building on our legacy and reaffirming our commitment to delivering a wide range of choice and convenience for consumers, as well as value for our Redbox stakeholders.”

Smith also noted that “this transaction, and the incremental capital it provides” will help the company continue its digital transformation and “advance our goal of creating a one stop experience that spans multiple entertainment mediums and simplifies the streaming experience.”

In the runup to going public, Redbox has made a number of significant efforts to expand its offerings and digital efforts, including: 

  • Entered into a multiyear distribution agreement with Lionsgate, under which Lionsgate will distribute Redbox Entertainment titles across home entertainment windows in addition to subscription video on demand (SVOD) licensing for select titles under the Redbox Entertainment brand.
  • Expanded the distribution footprint for its streaming app to the PlayStation 5 console, allowing consumers to stream thousands of Ad Supported Video on Demand (AVOD) movies and TV shows, as well as over one hundred Free Ad Supported TV (FAST) channels.
  • Signed a promotional agreement with Roku to further attract multi-platform users to the Redbox streaming app. Through mid-2022, consumers will receive a $5 streaming code on Roku players sold exclusively at Walmart.
  • Announced it will add over 20 Free Ad Supported Television (FAST) channels to its streaming service including live local news, Spanish language, and kids programming, bringing the total number of channels available to over 100.
  • Signed a distribution agreement with Vewd – one of the world’s largest providers of OTT and hybrid TV solutions – to pre-load the Redbox streaming app on new and existing Vewd powered TVs and set-top boxes in the US.

The business combination was unanimously approved by the parties’ Boards of Directors, and approved by Seaport Global Acquisition’s stockholders at a special meeting on October 20, 2021, Redbox reported. 

The transaction, combined with a fully committed private investment in public equity (PIPE) of $50 million led by Ophir Asset Management and backstop agreements with certain funds announced on October 11, 2021, will provide Redbox with approximately $88 million in cash. Redbox intends to use the funds from the transaction to pay down existing debt, pay transaction costs and fees, fund future growth investments, and for general corporate purposes.

The final number of shares redeemed totaled 12,346,223. As a result, Redbox will have approximately 45.4 million shares outstanding, of which approximately 2.0 million shares will be immediately tradeable. The shares that will be purchased as part of the backstop agreements, along with the PIPE, will be registered for resale separately in the future.