Online broadcasters to merge

Online broadcasters JumpTV and NeuLion have announced their intent to merge, creating one of the industry’s largest Internet Protocol TV providers.

New company will focus on sports programming, providing pro and collegiate properties to Internet and set-top box users, as well as ethnic programming for Chinese, Filipino, Arabic and Spanish-speaking auds. Merger also brings together NeuLion’s booming set-top box biz with JumpTV’s video streaming, ticket management and e-commerce business.

“The combination of our highly complementary technologies and depth of expertise in the areas of sports and international IPTV delivery makes for incredible synergy between the two companies,” said JumpTV exec chairman G. Scott Paterson.

The 50/50 deal treats both companies as equals. A public, Toronto-based company, JumpTV will issue approximately 50 million shares (worth around $40 million) to the private, Plainville, N.Y., based NeuLion as part of the transaction, which is expected to close by October.

JumpTV currently provides video services for more than 150 NCAA schools as well as international programming from more than 300 global channels, while NeuLion provides services to the National Hockey League and International Fight League, as well as major international networks — including 40 channels from China, top-rated Philippines network ABS-CBN and France’s Globecast.

NeuLion even provides the set-top box capabilities for Hawaii expats living on the mainland to watch newscasts and programming from the islands in real time. Company also is partnered with religious outfit SkyAngel, which offers 50 religious-based networks.

JumpTV has streamed more than 15,000 live sports events online over the past year, while NeuLion’s NHL broadband service streamed more than 1,700 hockey games alone.

“This shift creates enormous opportunity for content owners to reach untapped global audiences,” said NeuLion founder and CEO Nancy Li.

Li’s husband, Charles Wang — the founder of Computer Associates and owner of the New York Islanders — will serve as chairman of the merged company, while Paterson will be executive vice chairman. Li will serve as CEO and a director; Jump TV prexy Nada Usina will be president of the merged company. Jordan Banks continues as CEO of JumpTV in the interim.

As part of the merger, Wang has agreed to buy $10 million worth of units from the company, while Paterson will chip in an additional $1 million.

“We’re creating, in essence, a mini cable company,” Paterson said.

By combining operations, the companies said they expect to reduce their merged headcount by around 60 people by the end of the year.

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