Alliance Entertainment Goes Public Through SPAC Deal

Photo Credit: Samuel Regan-Asante

Alliance Entertainment goes public through a special merger (SPAC). Here’s what we know.

Alliance Entertainment Holding Corp. announced a deal with Adara Acquisition Corp. Upon closing, the combined company will be listed on the New York Stock Exchange under the ticker “AENT” and “AENT.WS”. Bruce Ogilvy and Jeff Walker will continue to lead the company as chairman and chief executive officer, respectively.

Alliance has over 485,000 unique entertainment products from Microsoft, Nintendo, Activision, Electronic Arts, Sega, Funko, Disney, Warner Home Video, Universal Video, Sony Pictures, Fox, Lionsgate, Paramount, Warner Music, Sony Music, Universal Music, Mattel, Lego, Hasbro, Arcade1Up and over 500 other entertainment manufacturers.

Through its exclusive distribution divisions AMPED, Distribution Solutions and Cokem Alliance, it is the exclusive distributor of over 57,300 unique vinyl records, CDs, DVDs and video games to retailers worldwide.

E-commerce is a cornerstone of Alliance’s success and a significantly growing division, with more than 38% of the company’s $1.4 billion in sales delivered directly to consumers’ homes. In 2021, over 13,485,000 products were delivered as drop shipping to Amazon, Walmart, Best Buy, Wayfair, GameStop, Kohls, Target, and hundreds of other e-commerce customers.

The DTU Alliance division also has its own websites and retail brands such as Deepdiscount.com, Popmarket.com, Importcds.com, Critic’s Choice Video, Collectors Choice Music and Movies Unlimited. In addition, the company has accounts worldwide on eBay, Amazon Marketplace, Discogs and many other online stores.

As a public company, Alliance Entertainment will expand its reach for future acquisitions, as well as invest in further automating its distribution centers and upgrading its own software.

“Alliance Entertainment, with limited capital, has grown into a leading distributor and wholesaler of entertainment products,” adds Bruce Ogilvy, chairman of Alliance Entertainment. “We are an important partner for the most famous entertainment brands and the largest retailers. As a public company, we will be well positioned for future strategic alliances that further diversify our product offerings, as well as further investment in our operations and proprietary technologies.”

The business combination implies a provisional equity value of the combined company of approximately US$480 million. Upon completion of the transaction, and subject to no share buyback by public shareholders of Adara, the current owners of Alliance Entertainment will own 78% of the combined company, and the current shareholders of Adara will own 22% of the combined company.

Alliance Entertainment will receive $115 million in cash held in trust. The deal is expected to close in the fourth quarter of 2022 and has been unanimously approved by Alliance Entertainment and Adara’s board of directors.

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