KVH Industries Acquires Headland Media
Enhances KVH's Initiatives to Offer Value-Added Media & Entertainment Services
for Maritime Satcom Customers Worldwide
MIDDLETOWN, R.I., May 13, 2013 (GLOBE NEWSWIRE) -- KVH Industries, Inc.
(Nasdaq:KVHI) today announced that it has acquired Headland Media Limited, a
media and entertainment services company. Headland Media is a leading provider
of commercially licensed news, sports, movies, and music content that they
sell in the maritime, hotel, and retail markets.
"The acquisition of Headland Media supports our strategic vision of extending
our maritime broadband service to also include delivering premium content to
vessels," said Martin Kits van Heyningen, KVH's chief executive officer.
"We've captured a leading market share in the maritime VSAT market for
one-to-one connectivity, and are now rolling out a new, highly efficient,
low-cost multicasting capability that we believe will create significant
growth opportunities for Headland Media's content by eliminating the time and
cost of physically delivering DVDs to vessels. For KVH's mini-VSAT Broadband
service, Headland Media's premium content offers us a great opportunity to
create exciting new services that will help our customers keep their crews
happy, and in the process help us differentiate our service and increase our
With extensive experience in the licensed content business, UK-based Headland
Media has 115 employees, and offices in the UK, Europe, the United States,
India and the Philippines. Headland Media has established relationships with
content providers and a customer base of 9,600 vessels, 1,700 hotels, and
1,700 retail outlets receiving their various services. In 2012, Headland Media
generated revenue of $12.2 million, of which approximately 85% was derived
from annual subscription-based services. During that same period, the gross
profit margin was almost 78%. Speaking of the acquisition and the
opportunities ahead, Mark Woodhead, CEO of Headland Media, remarked, "We're
excited to be part of the KVH family and to work with our new colleagues in
developing the next generation of onboard entertainment services for ships at
sea. The trend towards digital delivery of movies, news, and sports clips has
been apparent to us for several years. When we discussed KVH's capabilities,
there just seemed to be a natural fit between their maritime VSAT service and
our news, sports, and entertainment content."
Headland Media provides television shows, premium movies, sports, news
channels, and music for exhibition in commercial locations, which include
ships at sea. KVH's capabilities to multicast data in the background during
network idle times, and cache, manage, and distribute data onboard vessels
using its Integrated CommBox Modem (ICM) will serve as key enabling technology
for Headland Media's services. Headland Media's broad content range, which KVH
intends to deliver over the mini-VSAT Broadband network, will also enable KVH
to bring Internet Protocol television (IPTV) technology to the maritime
Mr. Kits van Heyningen concluded, "We see this acquisition as a great start to
KVH's new initiative to bring our customers the same high-quality multimedia
content they enjoy onshore, but have usually been unable to receive over their
maritime satellite service because of either prohibitively high costs or
protocol blocking associated with service providers' fair use policies.We
believe that KVH's capabilities will help Headland Media grow sales of its
services, and that having news, sports, and premium movies available on our
mini-VSAT Broadband network will help our sales efforts as well."
The $24.0 million transaction is anticipated to be accretive to KVH earnings
per share in 2013. The company financed the transaction from its cash on hand
and proceeds from its existing credit facility.
Visit www.minivsat.com for more information about KVH's mini-VSAT Broadband
satellite communications solution and www.headlandmedia.com for more details
regarding Headland Media.
KVH is holding a conference call live at 10:30 a.m. EDT today to discuss this
announcement.To listen, call phone number +1 719-325-2494 (passcode 3965100)
or you may access the call through the company's website at
investors.kvh.com.Listeners are welcome to submit questions pertaining to
this announcement to firstname.lastname@example.org. The audio archive and an MP3 podcast will
also be available on the company website within three hours of the completion
of the call.
About KVH Industries, Inc.
KVH Industries is a leading manufacturer of solutions that provide global
high-speed Internet, television and voice services via satellite to mobile
users at sea, on land, and in the air. KVH is also a premier manufacturer of
high performance sensors and integrated inertial systems for defense and
commercial guidance and stabilization applications. The company is based in
Middletown, RI, with facilities in Illinois, Denmark, Norway, Singapore, and
This press release contains forward-looking statements that involve risks and
uncertainties. For example, forward-looking statements include statements
regarding the anticipated accretive impact of the acquisition, plans for
Headland Media's existing services, the introduction of new services,
including delivering Headland Media's content and IPTV via KVH's mini-VSAT
Broadband network, and the anticipated cost of, and ability to offer, such
services.The actual results we achieve could differ materially from the
statements made in this press release.Factors that might cause these
differences include, but are not limited to: the risk that customers will not
promptly transition to digital content delivery, the potential loss of key
customers or suppliers, competitive risks arising from entry into a new
market, costs and risks associated with the integration of the operations of
Headland Media, including expansion of internal control over financial
reporting to numerous acquired entities in various jurisdictions, costs and
risks associated with managing operations in jurisdictions that are new to
KVH, execution risks associated with the content distribution business, which
is a new business model for KVH, potential diversion of management attention,
the ongoing need to renew and extend content licenses with a substantial
number of content providers, the challenges of offering digital content in
multiple legal jurisdictions, the potential need for additional content
licenses for new services, potential cost increases impacting anticipated
accretiveness, including borrowing costs, potential unknown acquired
liabilities, unanticipated legal or contractual impediments, the potential
loss of key hired personnel, and restrictions on the repatriation of
earnings.Other risk factors are discussed in detail in our most recent Form
10-Q filed with the Securities and Exchange Commission on May 9, 2013.Copies
are available through our Investor Relations department and website,
http://investors.kvh.com. We do not assume any obligation to update our
forward-looking statements to reflect new information and developments.
KVH Industries, Inc., has used, registered, or applied to register its
trademarks in the USA and other countries around the world, including the
following marks: KVH, KVH logo, Azimuth, TracVision, TracPhone, Tri-Americas,
CommBox, TACNAV, Sailcomp, mini-VSAT Broadband and the mini-VSAT Broadband
logo, E•Core, and the banded, dome-shaped housing of its satellite
antennas.Other trademarks are the property of their respective companies.
CONTACT: KVH Industries, Inc.
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