Gail Chiasson, North American Editor
RMG Networks Holding Corporation (RMG Networks), Dallas-based provider of technology-driven visual communications solutions, has entered discussions with certain unaffiliated third parties regarding the proposed sale of its Media business, also known as the RMG Airline Media Network.
The contemplated sale does not include the RMG Office Media Network.
As a result of these discussions, RMG Networks has signed a non-binding letter of intent to sell its RMG Airline Media Network business for $5.5 million, plus the assumption of certain liabilities to an unaffiliated third party. The parties are in the process of negotiating a definitive agreement.
“This possible divestiture will allow us to strengthen our balance sheet, reduce expenses and allocate additional resources to accelerate growth in our Enterprise business,” says Robert Michelson, CEO and president, RMG Networks. “While our Media business is a leader in its space, its strategic sale will allow us to focus attention on our Enterprise business, which we believe provides us with more significant long-term growth opportunities. We believe the focus that this potential sale will give us, along with the other strategic and operational initiatives we are pursuing, will allow us to more quickly achieve our ultimate goal of sustainable profitability.”
To advance negotiations for the sale of its Media business and for other matters, the company has temporarily postponed its fourth quarter and year-end 2014 earnings release and conference call which were originally scheduled for today, Thursday, March 19/15. An additional announcement will be made to disclose a new date for the earnings release and conference call as soon as details are finalized, but the company expects to report its fourth quarter and year-end 2014 earnings within the guidelines set forth by the Securities and Exchange Commission. The company does not expect any changes to its previously announced preliminary financial results for its fourth quarter and full year ended Dec. 31/14.
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