Under the terms of the agreement, Creative Realities will merge into a subsidiary of Wireless Ronin, with the sole equity holder of Creative Realities (which is an affiliate of Pegasus Capital Advisors, L.P., or “Pegasus”), receiving approximately 58.5% of the outstanding shares of Wireless Ronin common stock, calculated on a modified fully-diluted basis, including the shares of common stock to be issued in connection with Wireless Ronin’s pending merger with Broadcast International Inc. (“Broadcast”), and warrants to acquire an additional 1.5% of Wireless Ronin’s common stock.
The board of directors of both companies has approved the merger. Paul Price, currently Chief Executive Officer (“CEO”) of Creative Realities, will assume the role of CEO of the combined company and Scott Koller, currently CEO of Wireless Ronin, will become President. Upon consummation of the merger, the board of directors of the combined company will have five members, with three members designated by Creative Realities and two members designated by Wireless Ronin.
This is a very exciting time for our company and an incredible opportunity for our customers and partners,” says Price. “Over the past decade, we have focused on differentiating ourselves by providing our customers with a single-source solution for improving the shopping experience through marketing technologies. As a result, we have significantly expanded our customer base and today, represent many of the world’s most recognized retailers, venues and brands.”
“The union of Creative Realities and Wireless Ronin will further strengthen our technology platform and together, we will be more equipped to help our customers drive the in-store engagement, with the end goal being, increased sales. Furthermore, we believe that by combining our resources, we will be the only company capable of helping clients go from the planning and design phase to deployment and ongoing maintenance of the marketing technology experience, all sourced from under one roof.”
Creative Realities, founded in 1998 with headquarters in New York, NY and its operation center in Fairfield, NJ, is a well-known and trusted marketing technology company providing solutions to enhance the 21st century shopping experience. The Company provides a suite of tools and services for retailers, venue operators and their brand partners. Among the new Company’s customers will be Adidas, Adspace, Aramark, Calvin Klein, Chrysler, KFC, Macy’s, Nestle, Rite Aid, Sunglass Hut, and many more. Using the latest innovations in sensor, display, networking, software and mobile technologies, Creative Realities helps marketers improve their store and brand experience by acting as an agnostic systems designer, deployer and manager of these and other technologies.
Except they are no longer agnostic, really. The model is arguably most similar to Canada’s Cineplex, which acquired the software firm EK3 and rolled it under the larger company umbrella. It’s only logical these companies are going to lead with their own stuff.
“This merger brings together two industry leaders with highly complementary technology, talent and customers,” says Koller. “Our creative services team, coupled with our content management platform, has helped many of the largest marketers maximize their top- and bottom-lines. When I look at the synergies between our offerings and those from Creative Realities, I am excited with the powerful combination. We are both focused on improving the shopping experience through various marketing technologies and this merger holds great opportunities for continued growth with our customers, while at the same time, providing them with a complete suite of services from a single source.”
Alec Machiels, Partner with Pegasus stated, “Creative Realities has been one of our fastest growing portfolio companies in recent years, led by experienced management who share a unique vision of the future of marketing technologies. Under Paul’s leadership, they have expanded into new geographies and markets, leveraging technology to help the world’s largest retailers and brands. This merger makes strategic sense, as both companies have similar market approaches, but differentiated technologies and skills. We see opportunities to capture immediate revenue streams and also realize incremental cost savings due to synergies within their respective businesses. With the rapidly expanding rise of mobile devices and other technologies, it is increasingly important for marketers to have one partner that can help drive engaged customer experiences across all channels and platforms. We believe the combination of these two businesses will make this vision a reality.”
Consummation of the proposed merger is subject to various conditions, including the completion of Wireless Ronin’s currently pending merger with Broadcast. Subject to the satisfaction of such conditions, the merger is expected to be consummated in July 2014. There can be no assurance that the conditions to the merger will be satisfied or that the merger will be completed.
Well then … the long-expected deal/fire sale/rescue/choose your own words finally happened, just as the Ronin was mere dollars away from eclipsing the $100 million accumulated deficit. By the count of an industry friend who has an accounting background, the number was at $99,601,000 at the end of March 2014.
$100M that isn’t coming back.
I know precious little about CRI, other than they did the Macy’s Herald Square digitalscreenpalooza – screens everywhere, all for different brands, with not much cohesion. My take – happy to see brands investing, but it’s also a bit of a mess in finish and content choices. Some other observers have been less kind.
Why CRI needs a dedicated software platform, I dunno. You go from identifying the needs to trying to make the in-house capabilities work.
This is not CRI’s first brush with a software company. Five years ago, Pegasus was already an investor in CRI when it bought Coolsign from Planar. That went sideways within a couple of years and Coolsign ended up in Haivision’s clutches.
Not mentioned in this deal, as far as I can see, is the earlier merger of Ronin and Utah’s Broadcast International.
The market didn’t exactly explode as news of this deal came out. Late in the trading day, 1,000 shares had moved and the stock was up two cents.
There’s usually all kinds of interesting things in the filings, but they make me cross-eyed. If you see something, let me know …
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