NYT has a story about the rise of “blank check” media acquisition vehicles…we mentioned one founded by RCN founder David McCourt last year…McCourt invested in and is now the CEO of Narrowstep, a London-based online video company.
The “special purpose acquisition corporations,“or SPACs have been gathering steam over the past two years as an alternative to private equity as Wall Street firms like Deutsche Bank, Citigroup, Merrill Lynch and Lazard have begun underwriting them, the story says.
Some examples: Last month, a company called Media & Entertainment Holdings led by Herbert Granath, the longtime ABC executive and former chairman of ESPN, raised $100 million by selling shares and warrants. In February, another SPAC called Churchill Ventures raised $108 million. Its CEO Christopher Bogart, is a former general counsel of Time Warner and CEO of Time Warner Cable Ventures. Last summer, a company led by Eddy Hartenstein, the founder and former CEO of DirecTV, raised $150 million for a new company called HD Partners.
So far, most media SPACs are seeking to buy companies for under $500 million, which puts the deals they seek under the radar of most big private equity firms.