Alliance Entertainment is going public via a special acquisition (SPAC) merger. Here’s what we know.
Alliance Entertainment Holding Corp. has announced a deal with Adara Acquisition Corp. Upon closing, the combined entity will be listed on the New York Stock Exchange under the ticker symbols ‘AENT’ and ‘AENT.WS.’ Bruce Ogilvie and Jeff Walker will continue to lead the company as Chairman and CEO, respectively.
Alliance stocks over 485,000 unique entertainment products from Microsoft, Nintendo, Activision, Electronic Arts, Sega, Funko, Disney, Warner Home Video, Universal Video, Sony Pictures, Fox, Lionsgate, Paramount, Warner Music, Sony Music, Universal Music, Mattel, Lego, Hasbro, Arcade1Up, and over 500 additional entertainment product manufacturers.
Through the exclusive distribution divisions of AMPED, Distribution Solutions, and Cokem, Alliance is the exclusive distributor of over 57,300 unique vinyl, CD, DVD, and video game products to retailers worldwide.
eCommerce fulfillment is a cornerstone of Alliance’s success and a significant growing division, with over 38% of the company’s $1.4 billion in sales being delivered directly to consumer homes. In 2021 over 13,485,000 products were delivered as a drop shipper for Amazon, Walmart, Best Buy, Wayfair, GameStop, Kohls, Target, and hundreds of additional eCommerce customers.
The DTU division of Alliance also has its own websites and retail brands, such as Deepdiscount.com, Popmarket.com, Importcds.com, Critic’s Choice Video, Collectors Choice Music, and Movies Unlimited. In addition, the company has worldwide accounts on eBay, Amazon Marketplace, Discogs, and many more online retailers.
As a public company, Alliance Entertainment will enhance its ability to pursue future acquisitions while also investing in further automation of its distribution facilities and upgrading its proprietary suite of software.
“Alliance Entertainment with limited capital has grown into a leading distributor and wholesaler of entertainment products,” adds Bruce Ogilvie, Chairman of Alliance Entertainment. “We are an essential partner to the best-known entertainment brands and largest retailers. As a public company, we will be well positioned to pursue future strategic combinations that further diversify our products offerings, and to invest further in our operations and proprietary technology.”
The business combination implies a proforma equity value of the combined company of approximately $480 million. Upon completion of the transaction, and assuming no redemptions by public shareholders of Adara, the current owners of Alliance Entertainment will hold 78% of the combined company and current Adara shareholders will hold 22% of the combined company.
Alliance Entertainment will receive proceeds of $115 million of cash held in trust. The deal is expected to close in Q4 2022 and has been unanimously approved by Alliance Entertainment and Adara’s board of directors.