NOVACAP sells stake in Stingray Digital after seven years of solid growth
June 05, 2015
MONTREAL, JUNE 3, 2015 – NOVACAP, one of Canada's leading private equity firms, is pleased to announce that it has today sold most of its 29.4% stake in Stingray Digital Group Inc. (“Stingray”) after a successful seven year partnership.
“We are extremely proud of Stingray and what we have accomplished over the last several years culminating in the closing of its successful IPO today,” said Pascal Tremblay, President and Managing Partner of NOVACAP TMT GROUP. “We have to credit Stingray’s team of professionals, who have helped the company grow into a leading global multi-platform music service provider, reaching over 110 million subscribers in 111 countries. NOVACAP is pleased to have backed them and to be part of this wonderful success story.”
In December 2007, NOVACAP invested $10 million in Stingray. This investment was made at a critical time when Stingray acquired the Galaxie music channels (now known as Stingray Music channels), providing Stingray with access to more than 6 million households. For the year ended March 31, 2008 to fiscal year 2015, Stingray Digital’s annual revenues have grown from $7.1 million to $71.0 million, at a compound annual growth rate of 38.9%.
“NOVACAP’s investment in our company and the advice they provided were crucial to building our company,” said Eric Boyko, President and CEO of Stingray. “We are excited to be taking this next step forward, which will allow the company to grow even further.” As Stingray began trading on the Toronto Stock Exchange today, NOVACAP has retained 20% of its original equity position in the business, representing approximately 4% of the issued and outstanding securities of Stingray, because it continues to believe in the ability of the company’s management team to execute its growth plan.
NOVACAP played a key role in all 18 acquisitions Stingray made since 2007. NOVACAP provided insights on growth strategy, optimal market focus, synergies assessment, financial and tax structuring, valuation and governance. All key strategic decisions were made in collaboration with Stingray’s management, NOVACAP and other strategic investors. These strong relationships contributed to making Stingray a dominant player in its industry.
“The success of Stingray shows the viability of Montreal’s technology companies,” said Mr. Tremblay. “We will continue to make investments in companies with similarly great potential and we look forward to continuing our relations with Stingray.”
With assets under management of over $1.5 billion, NOVACAP has consistently been recognized as one of the leading private equity firms in Canada since 1981. Its unique collaborative approach with entrepreneurs, based on deep operational expertise and active management of its investment, has helped accelerate growth and maximize value for many companies across North America. NOVACAP’S culture is based on creating long-term value through an investment philosophy focused on discipline and growth. With an experienced management team and substantial financial resources NOVACAP is well positioned to continue building world-class companies. For more information, please visit www.novacap.ca.
Adam Daifallah, HATLEY Strategy Advisors, 514.316.7089, [email protected]