Visual Data Corp. Takes Controlling Interest in EDnet
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San Francisco-based audio and video network service provider EDnet Inc. signed an agreement with Visual Data Corp., whereby EDnet will receive $1.4 million in cash, stock and a secured note in return for a controlling interest of 51% of the company's common stock.
In addition to providing operating capital to fund future growth, the infusion of cash and stock is being used to reorganize the company's balance sheet, resulting in a positive net working capital and equity position, EDnet said. The agreement is expected to close by the end of July.
EDnet said that upon closing, its board of directors will be increased from four to seven members. Randy Selman, Visual Data's president and CEO, will become the chairman of EDnet's board. Other new directors are David Goodman, Alan Saperstein and Brian Service. David Gustafson, Tom Kobayashi, and Robert Wussler, will remain as directors.
"This transaction will allow the company to move aggressively forward and focus its attention on growth," stated Tom Kobayashi, CEO of EDnet. "We're very pleased with the synergies between our audio and video networking and Visual Data's need to gather information quickly and easily from their clients. Additionally, our Internet Business Solutions team has already discovered numerous opportunities to support Visual Data's innovative distribution of short-form video."
"The opportunity to better serve both EDnet's professional entertainment and media clients, and Visual Data's multimedia clients, through the economies and synergies created by the partnering of EDnet's services with those of Visual Data make this union very exciting," said David Goodman, chief operating officer of Visual Data.
EDnet is a systems integrator specializing in the transmission of data over wide area networks, and the development and hosting of interactive database oriented Internet web sites for the entertainment, advertising and corporate markets.
Clients include LucasFilm's Skywalker Sound, Sony Music Entertainment, Disney/MGM Studios, Capitol Studios, Warner Brothers, Kaiser Permanente, Casio, CompareNet and Citibank.