Vector aims magnitude of money in direction of Technicolor

Joseph O'Halloran ©RapidTVNews | 29-05-2012

US private equity technology specialist Vector Capital is to challenge J P Morgan Chase in a bid to become the main shareholder in beleaguered digital TV technology firm Technicolor.
The news comes only a matter of weeks after Technicolor announced a capital increase plan to reduce its debt and allow One Equity Partners, the private investment arm of JPMorgan Chase to increase its stake from just about a single percentage to somewhere in the range of 25–29.96%. JPMorgan would thus become a long-term shareholder in the company and a stable shareholder.
The French firm intended to use the capital increase of up to €158 million to strengthen its balance sheet—enhancing its capability to implement its “Amplify 2015” strategic roadmap—and also contribute to stabilising its shareholder base.

Yet in this dramatic intervention, as reported by The Financial Times, Vector is said to be offering to pay €1.90 a share for a 17.5% stake in Technicolor and then subscribe to a rights issue at €1.56 a share to lift its stake from 0.6% to just under 30%, for a total outlay of up to €186 million .

The FT said that Vector is mainly interested in Technicolor’s patent portfolio, which covers telephone, television and tablet technology and which it believes is being undermanaged. It is also said to be looking at Technicolor’s post-production special effects technology.