SBJ/July 6-12, 1998/This Weeks News

Entertainment company plans to merge with ailing roller hockey league

Beachport Entertainment Corp. and Roller Hockey International – neither of which has ever reported a profit – announced last week that the two companies will merge in a transaction valued at nearly $25 million.

RHI had planned an initial public offering last week, but that was canceled due to the Beachport merger agreement.

RHI has been under financial duress since its inception in the early 1990s as the first roller hockey league. The league has reportedly lost as much as $41 million since it was founded.

Beachport Entertainment, a Los Angeles company that produces ice-skating and horse shows and concerts, went public last year.

Beachport’s net loss for the six months ending Dec. 31 was $1.5million, or 16 cents a share, compared with a net loss of $2.9 million, or 42 cents a share, in the year-ago period, the company reported.

RHI still plans to have a roller hockey season next year, with roughly 12 teams, said Beachport Chief Executive Officer Barry Mendelson. The league decided against playing this year after several of its teams defected to the rival Major League Roller Hockey.

The new company, which will have two operating units, RHI and Beachport, has settled on a CEO but would not disclose that person’s identity. The transaction is expected to close in the fourth quarter of this year.

The new company, which will be based in Los Angeles, plans to build multi-use participatory and spectator sporting facilities.

Beachport said the merger was contingent on the successful completion of a $16 million stock offering. That offering is being managed by Bluestone Capital, a New York-based investment bank that was managing RHI’s IPO.

Beachport Entertainment is listed under the symbol BPRT on the Nasdaq Pink Sheets, an exchange of thinly traded small-market capitalization stocks.

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