Struggling 3-D cinema technology company RealD Inc. said it had reached a deal to sell the company to Rizvi Traverse Management for $551 million.
The Beverly Hills-based company said Rizvi, a leading private equity investor in the media sector, had agreed to acquire RealD for $11 per share in an all-cash transaction that would take the company private.
Rizvi’s other investments have included Summit Entertainment, ICM, Twitter, SpaceX, Square and Snapchat.
RealD’s board of directors approved the agreement with Rizvi and recommended shareholders vote in favor of the transaction.
“Over the past year, the RealD board of directors, in consultation with its advisors, has engaged in a comprehensive review of strategic alternatives to enhance value for shareholders,” said Frank J. Biondi, lead independent director of RealD’s board. “This transaction with Rizvi Traverse concludes that review and provides immediate and substantial cash value to RealD shareholders at a significant premium to the company’s unaffected share price.”
Chief Executive Michael Lewis will continue to serve as chairman and chief executive officer of RealD.
Founded in 2003, RealD is one of the world’s leading providers of 3-D cinema equipment and glasses. Its systems are used in more than 27,000 screens worldwide.
But the company has struggled in recent years as the popularity of 3-D viewing has waned. The company on Monday reported a second-quarter loss of $7.9 million, or 15 cents a share, compared with a loss of $751,000 or 2 cents a share, a year earlier. Revenue fell nearly 20% to $38.5 million.