Extreme Reach Acquires Talent Partners

What: Video ad delivery firm Extreme Reach has completed the acquisition of Talent Partners, provider of business affairs solutions for advertisers and agencies, from The Carlyle Group and other minority shareholders.Financial terms of the transaction were not disclosed.
Why it matters: The equity and debt deal will help position Extreme Reach to assist advertisers with the behind-the-camera aspects of their campaigns across both television and digital video.

VSlJ-10v_400x400Extreme Reach, a Video ad delivery firm, has completed the acquisition of Talent Partners from The Carlyle Group and other minority shareholders. The Carlyle Equity Opportunity Fund will retain an ownership position in the combined company. Financial terms of the transaction were not disclosed.

The deal will help Extreme Reach positioning to assist advertisers with the behind-the-camera aspects of their campaigns across both television and digital video, according to Chief Executive Officer John Roland.Extreme Reach, whose technology helps marketers and ad agencies place and track their ads on television and across the Web, is hoping the acquisition will help connect the two worlds that Mr. Roland says currently operate as silos.

Extreme Reach provides an enterprise-class, cloud-based video platform that enables a single workflow and unified measurement for TV and digital video advertising, including fully integrated talent and rights management capabilities that automate processes and solve compliance issues for video advertising across every screen.

Talent Partners, for decades, has been the leading provider of business affairs solutions for advertisers and agencies, including the management of talent contracts and payment and the handling of rights and royalties for commercials across TV and digital video advertising. In 2014 Talent Partners served more than 750 agencies and production company clients worldwide, representing more than 1,500 brands, and made payments to more than 75,000 actors and other commercial talent totaling more than US$1 billion in transactions. Talent Partners operates offices in five markets across North America and the United Kingdom, with 250+ employees and US$60 million in 2014 revenue. Its offices and personnel will be immediately integrated into Extreme Reach. With this acquisition, Extreme Reach now has 1,000 employees.

Today, digital video is one of the fastest growing advertising formats. And as video media and audiences have become more and more fragmented, critical talent and rights processes have broken down, leading to inefficiencies and significant unexpected costs. Specifically, when utilizing TV ads in the digital environment, advertisers need to ensure that the contracts established with featured talent such as actors, announcers and music licensors include Internet use permissions. Otherwise, unexpected contract costs and penalties can ensue.

Tim Hale, Chief Talent Officer at Extreme Reach noted, “In the digital video advertising realm, more than a third of all ads do not follow legal contracts for talent and rights. This could lead to millions of dollars in unexpected costs across the industry. By acquiring Talent Partners, we have a unique opportunity to move the industry forward. Our leading talent and rights solution is fully integrated with our TV and digital video advertising platform, and each step in the advertising process is seamlessly connected to the next.”

In announcing the acquisition, John Roland, CEO of Extreme Reach, added, “TV commercials are being shown across every screen and device. In fact, nearly 90% of the video ads used in digital video advertising campaigns are commercials that were created for TV, which has increased the complexity of talent rights management. By adding Talent Partners’ scale to our video platform, nearly all of the Ad Age 100 largest advertisers will benefit from our state-of-the-art ad technology.”

Nils Larsen, Senior Operating Advisor for the Carlyle Equity Opportunity Fund, who has been involved with Carlyle’s investment in Talent Partners since its acquisition in 2014, will be on the board of Extreme Reach. The acquisition was financed by a combination of equity and debt financing. Rockdale Partners acted as the exclusive financial advisor and Pierce Atwood LLP acted as legal advisor to Extreme Reach in the transaction. Goodwin Procter LLP acted as legal advisor to Talent Partners. J.P. Morgan and SunTrust Robinson Humphrey acted as joint lead arrangers for the debt facility.