Scholastic is strengthening its entertainment business: The children’s publishing and media company announced a $186 million deal to acquire a full economic stake in 9 Story Media Group, a leading children’s content production and distribution company.
With this investment, Scholastic will acquire 100% of the economic interest and a minority voting interest in 9 Story Media, the animation studio that produces television shows including “Doc McStuffins” (Pictured above), “Daniel Tiger’s Neighborhood”, “Octonauts”, “Wild Kratts” and “The Magic School Bus Rolls Again”.
The deal “consolidates” more than two decades of collaboration between Scholastic Entertainment and 9 Story, the companies said. The investment was approved by the boards of directors of both companies and the shareholders of 9 Story. The transaction is expected to close in Scholastic’s first quarter of fiscal 2025, which begins June 1, 2024, subject to customary closing conditions.
“This highly strategic combination, which adds 9 Story’s industry-leading capabilities with Scholastic’s trusted brand and proven ability to create iconic children’s series and franchises, has tremendous potential to build deeper relationships with young people through our stories, as they reach the pages of our books,” said Peter Warwick. President and CEO of Scholastic, in announcing the agreement: “Life on screens and through promotion.”
9 Story’s divisions include award-winning studio Brown Bag Films; 9 Story Distribution International, which represents more than 5,000 half-hour episodes of children’s animated and live-action programming, including “Clifford the Big Red Dog” and “A Kind of Spark”; and 9 Story Brands, a consumer products division, which builds global children’s brands both on and off screen, including “Daniel Tiger’s Neighborhood,” “Karma’s World” and “Super Why.” 9 Story recently announced a deal with Crayola Studios to handle production and distribution for new original projects, as well as the acquisition of Portfolio Entertainment’s library, production slate and development projects, which has added more than 550 half-hours of content.
“We have been fortunate to work with Scholastic for decades, going back to my beginnings with the family favorite production, The Magic School Bus,” Vince Commisso, president and CEO of 9 Story, said in a statement. . “Combining our global studios, sales and distribution capabilities with Scholastic’s existing media business, iconic name and unique capabilities opens up even more opportunities to deliver compelling stories and build impactful brands for audiences around the world. We are eager to begin bringing together our complementary talents to strengthen Scholastic’s position as a top developer.” A producer and distributor of children’s and family content.
9 Story reported revenue of $104 million in its most recent fiscal year, ending August 31, 2023. Scholastic expects the addition of 9 Story to increase long-term earnings, reduce the capital intensity of production and “drive significant improvements at the top levels.” . Growing the pipeline and bottom line through 9 Story’s existing content library, best-in-class production studios, and global distribution and licensing capabilities. Scholastic said it intends to initially fund the transaction from available cash and its revolving credit facility and “expects to maintain its regular dividend and approved stock repurchase program.”
9 Story Media operates facilities in Toronto, Dublin, New York and Bali, and employs approximately 850 creative and corporate staff around the world.