The Toy Book previously covered plans for Scholastic to invest in 9 Story Media Group, a maker and distributor of kids’ content. Now, those plans have come to fruition.
Scholastic has finalized its agreement to invest in 9 Story Media Group, following a satisfactory opinion from the Minister of Canadian Heritage. The investment will see Scholastic acquire a minority of voting rights and 100% of the economic interest in 9 Story for approximately $182 million, from an affiliate of private equity firm ZMC as well as other selling shareholders.
Together we will continue to deliver high-quality, engaging content for kids and families, while significantly expanding our joint ability to build franchises on a global scale.
Scholastic funded the transaction initially using available cash as well as revolving credit facility and anticipates. The company expects the acquisition to contribute to long-term earnings accretion, reduce the capital intensity of production, and improve top-line growth and bottom-line results through 9 Story’s content library, production studios, and global distribution.
“I’m confident that our shared mission and collective expertise will spark innovation and creativity across the entire IP life cycle, supporting our 360-degree content creation strategy and our opportunity to meet the strong demand for high-quality kids and family entertainment,” says Peter Warwick, President and CEO of Scholastic.
Building upon the strong foundation we’ve developed with the 9 Story team over the past 20 years, we’re excited to now participate in the full IP life cycle by combining Scholastic’s ability to create IP that kids love with 9 Story’s best-in-class ability to produce, distribute and license it.
Throughout negotiations, CDX Advisors served as the exclusive financial advisors to Scholastic, while Barclays worked as the exclusive financial advisor to 9 Story. Baker & McKenzie LLP, Dentons Canada LLP, and Mason Hayes & Curran LLP served as Scholastic’s legal counsel, while Sidley Austin LLP served as ZMC’s legal counsel and Goodmans LLP served as 9 Story’s legal counsel.
President and CEO Vince Commisso will continue to serve at 9 Story Media Group, and Iole Lucchese will continue work as Scholastic Board Chair and President, Scholastic Entertainment.
Starting in the current fiscal 2025 year, Scholastic will consolidate its and 9 Story’s financial results into a new reporting segment. The company plans to release information on 9 Story’s and its own historical financial results and outlook next month, with its fiscal 2024 fourth quarter report.
