PROVO, Utah - Angel Studios, the studio known for empowering fans to greenlight movies and TV shows, announced it will become a publicly listed company through a business combination with Southport Acquisition Corporation (OTC: PORT). This merger is expected to close in the first half of 2025, with the combined entity's Class A common stock to be listed on either the NYSE or Nasdaq under the ticker symbol "AGSD."
The studio, which will continue to be led by co-founder Neal Harmon, has seen significant growth with revenues of $45.0 million for the six months ended June 30, 2024, up from $39.0 million in the same period the previous year. Angel Studios attributes its success to its unique model that involves the Angel Guild, a community of members who select which films and shows the studio will produce and distribute. This approach has led to box office hits such as "HIS ONLY SON" and "SOUND OF FREEDOM," with the latter grossing approximately $250.0 million.
Angel Studios operates on a membership-based revenue model, with the Angel Guild providing monthly or annual fees. The studio also generates income from theatrical distribution, content licensing to distributors like Amazon (NASDAQ:AMZN) and Netflix (NASDAQ:NFLX), and merchandise sales. Furthermore, Angel Studios has been holding Bitcoin on its balance sheet since 2021 and plans to continue acquiring Bitcoin as a strategic treasury asset to support its mission-driven approach.
The transaction values the combined company at a $1.6 billion pro forma enterprise value, with existing Angel Studios stockholders rolling 100% of their equity into the new company. The merger is subject to customary closing conditions, including SEC registration statement effectiveness, stockholder approvals, and regulatory approvals, but does not have a minimum cash condition.
The boards of directors of both Angel Studios and Southport have approved the transaction. Additional information about the merger will be available in filings with the SEC by both companies.
This strategic move is anticipated to support Angel Studios in its continued growth and its innovative approach to content creation, empowering its community-driven model and Bitcoin treasury strategy. The information in this article is based on a press release statement.
InvestingPro Insights
As Angel Studios prepares to make its debut on the public market through its merger with Southport Acquisition Corporation, the financial metrics and market behavior of Southport are of particular interest to investors. According to recent data, Southport Acquisition Corporation (OTC: PORT) is trading at a low earnings multiple, which could be an attractive entry point for investors who believe in the combined company's future profitability. This is underscored by the fact that Southport is a prominent player in the Capital Markets industry, according to one of the InvestingPro Tips, which suggests a stable foundation for Angel Studios' transition to a publicly listed company.
InvestingPro Data reveals that Southport has a market capitalization of $75.98 million, with a notably high P/E ratio of -276.55. While this may raise eyebrows, it is important to note that adjusted metrics for the last twelve months as of Q2 2024 show a lower P/E ratio of -35.3, which may reflect a narrowing of losses or an increase in earnings. Furthermore, Southport's stock has experienced low price volatility, another InvestingPro Tip, which indicates a potentially less risky investment in terms of stock price swings.
For potential investors, it's also worth noting that Southport's liquid assets exceed its short-term obligations, which can be a sign of financial health and resilience. The company has also been profitable over the last twelve months, an encouraging sign for investors looking for growth potential in the merger with Angel Studios. For those interested in further insights, there are additional InvestingPro Tips available that provide a deeper dive into the company's financials and market position.
With the next earnings date set for November 13, 2024, and an InvestingPro Fair Value estimate of $9.93 per share, investors will be keen to monitor the performance of Southport as it finalizes its merger with Angel Studios. Keeping an eye on these metrics can provide a clearer picture of the financial landscape as Angel Studios embarks on its new chapter as a public entity.
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