So, it’s official. After a ton of speculation, Rovi Corporation announced that it has officially acquired digital video recording company TiVo in a $1.1 billion cash and stock transaction. The combined companies will be led by Rovi CEO Tom Carson, and upon closing they will adopt the TiVo brand as the company’s new name. TiVo has been led by interim CEO Naveen Chopra, who is also the company’s CFO.
Carson said that the deal—which was announced on April 29— will strengthen Rovi’s digital media distribution business through enhanced data analytics (TiVo owns video discovery platform Digitalsmiths), metadata, and IP licensing.
“As the media and entertainment landscape undergoes a significant evolution, the combined capabilities of TiVo and Rovi place us in a tremendous position to extend services across platforms and to a customer base that includes traditional, over-the-top and emerging players across the globe,” Carson said in a statement.
Rovi explained that the combined company ill feature more than 6,000 patents in digital media distribution and is expected to realize at least $100 million in annual cost synergies—65 percent of which will be recognized in the year 12 months.
Rovi and TiVo expect that the regulatory process will be complete and the deal will be officially recognized by the third quarter of 2016.
“We believe the timing of a transaction makes sense given each company hitting license tailwind inflection points, meaningful cost synergies, and the opportunity to coordinate efforts within the industry with a combined patent portfolio,” B. Riley & Co. analyst Eric Wold wrote in a May 2 note.