Mood Media purchases Muzak

In-store media specialist Mood Media Corp. announced it has entered into a definitive agreement to acquire Muzak Holdings LLC, a privately held company that is a leading provider of sensory branding services for business in the United States, for $345 million including net debt to be repaid on closing.

Based in Fort Mill, S.C., Muzak is the premier provider of a full range of brand-enhancing products. Its top-tier background and foreground music, voice and digital offerings reach more than 100 million people every day. In 2010, Muzak had $195 million in revenue and $55 million in EBITDA. More than 75 percent of Muzak's revenue is associated with multi-year customer contracts.

Mood Media's acquisition of Muzak will create a global in-store media provider servicing over 470,000 commercial locations in over 39 countries, according to the company. In the U.S., the combined business will serve over 200,000 national and 100,000 franchise locations.

The combined customer base will include more than 850 U.S. and international brands in diverse market sectors that include retail (food, fashion, cosmetics), leisure and hotels, oil and gas, telecommunications, financial institutions and fast food. Together Mood Media and Muzak will have an extensive music library that includes 1.7 million rights-included tracks and more than 30,000 original recordings, which means customers will benefit from greater product choice. The combined company will have trailing last twelve months (LTM) pro forma revenue of approximately $400 million and trailing LTM pro forma EBITDA in excess of $100 million. Over 60 percent of the combined company's revenue will be recurring subscription revenue, with a new contract life of three to five years.