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Kew Media Group Inc. is set to acquire a broad portfolio of 10 companies that own, produce and distribute film, television and other programming for $104.1-million.leolintang/Getty Images/iStockphoto

Kew Media Group Inc. is set to acquire a broad portfolio of 10 companies that own, produce and distribute film, television and other programming for $104.1-million.

From the Netflix documentary series Cooked, to lifestyle shows such as Dance Moms and Hockey Wives and a host of well-known documentaries, Kew is poised to buy companies that control 6,000 hours of media content sold in more than 150 countries.

The deal is being proposed to shareholders of the Toronto-based special-purpose acquisition corporation, or SPAC, just seven months after Kew made its public market debut. It was the sixth such investment company to be launched in Canada, and one of the only SPACs to come to market with a specific focus – the media sector.

"This is exactly what we intended – we were quite focused on doing a roll-up inside the media sector," said Steven Silver, chief executive officer of Kew. He is also co-founder of film and television production company Blue Ice Group. "We are media guys. This is what we do. And, as you can tell, we're sticking around to run it."

Kew first filed for an initial public offering in late 2015, but it took several months and an amended prospectus for the SPAC to get off the ground. Last summer, it was able to raise the $70-million that it had at first targeted.

SPACs were created in the U.S. market and first launched in Canada in 2015, with six companies raising a total of approximately $1-billion. While the concept was created with much fanfare, founders have struggled to put the capital to work.

Canadian SPACs have announced four potential acquisitions but only one SPAC, Alignvest Acquisition Corp., enjoyed a relatively smooth ride with investors as it acquired a U.S. wireless company.

To support its proposed transactions, Kew has already collected an additional $20-million from its shareholders as well as new investors in a private placement. The company said in a news release that it intends to complete the deal by March, after which founders of the SPAC are expected to own about 23 per cent of Kew's shares.

The deal still needs to be approved by shareholders, and a vote is expected to be scheduled in the coming days.

Kew will operate in New York, Toronto, Los Angeles and London. The companies it is acquiring include Content Media Corporation PLC, which is the largest distributor in the group, as well as Architect Films Inc. and Bristow Global Media Inc.

Of the 10 companies being acquired, Kew would fully own five of them, and have a controlling stake in the remaining five. And it will have full control of a large international distributor.

Mr. Silver said the television and film content market is fragmented, but "there are real advantages to scale." He said that by putting production companies together and widening the distribution networks, the shows and movies can reach a large audience.

Along with Mr. Silver, the SPAC's founding shareholders and board of directors include Peter Sussman, former co-controlling shareholder of Alliance Atlantis Communications who will act as Kew's executive chairman, Nancy Tellem, former president of CBS Network Television Group, and David Fleck, former chief executive officer of Macquarie Capital Markets Canada.

As Kew moves forward with its specialized deal, three other SPACs have either dropped planned takeovers or been forced to raise additional capital to fund their acquisition. The rules governing SPACs dictate the company must invest its capital within two years, or return the money to investors.

In the U.S. market, the first SPAC was launched in 2003 and since then, 213 SPACs have raised $34.4-billion (U.S.) Information service SPAC Analytics found that over 14 years, two out of three SPACs managed to get an acquisition done before time ran out and the SPAC had to return its cash.

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