TiVo raises $52 mil in new financing round

NBC, Discovery, BSkyB among investors

Digital video recorder maker TiVo said Wednesday that it has raised $51.8 million in financing from NBC and Discovery Communications, as well as its first European investor British Sky Broadcasting, among others.

Although Silicon Valley-based TiVo has not disclosed how it plans to use the new round, the financing should help fuel the company’s efforts to market its technology that enables couch potatoes to record, play back and pause TV shows via a set-top box.

TiVo burned through $50.5 million in the quarter ended April 30, while posting sales of merely $3.2 million. It generates revenues from licensing its patented technology to Rupert Murdoch’s BSkyB, AOL Time Warner and DirecTV, as well as through monthly subscription fees collected from its 189,000 subscribers.

In the new round, which comes only a day before TiVo announces its second-quarter earnings on Thursday, NBC and Discovery Communications are returning investors, while BSkyB is a newcomer to the TiVo financing family. That investment should further help TiVo expand its presence overseas.

Terms of the new round’s dilution of TiVo stock and the amount of money the company will ultimately raise are variable. The debt is convertible into common stock at an initial price of $6.73 a share, but that price could sink as low as $4.21 a share under certain circumstances. Shares of TiVo ended Wednesday trading at $6.14, up 61¢ or 11%.

At the lower price, the notes could be converted into a total of 12.3 million shares, or about 28% of TiVo’s current shares outstanding.

The three sets of warrants TiVo issued as part of the transaction could add as much as $55.7 million to TiVo’s treasury if exercised and add 7.6 million shares. That would be added to the $71.7 million in cash and $50.7 million in restricted cash TiVo had as of April 30.

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Leave a Reply

No Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More TV News from Variety

Loading