Billionaire Paul Ramsay’s Prime Media Group, which took control of Destra Corporation in April, is seeking offers for two of Destra’s three divisions.
SmartCompany has learnt that information packs have been prepared to seek offers for home entertainment division, DestraVision and DestraMusic, which is a distributor of compact disc and music DVDs.
These two divisions effectively comprise the majority of the Destra business. The proposed completion date of the sales process listed in the packs is 31 July for DestraVision and 7 August for DestraMusic.
If the sales proceeded, that would effectively leave DestraMedia, the operator of many online communities including MP3.com.au, TheScene.com.au, Planet X, and Niceshorts.com.au (short films), which is expected to be incorporated into Prime.
Destra, Australia's largest independent house for music, visual and theatrical entertainment, was founded 15 years ago by Dominic Carosa whose shareholding was slashed when Opes Prime collapsed.
In April, Prime took control of Destra, doubling its stake to 44% and appointing lawyer David Gordon, from advisory firm Lexicon Partners, as executive chairman. Most of the Destra board (including Carosa) resigned.
At the time it was reported that Prime Media’s plan was to merge key assets from online and content company Destra with its iPrime arm. This would create a single digital group that could be marketed to advertisers.
Gordon told SmartCompany yesterday that he would not comment except to say there was a lot of work going on. The company has commissioned a strategic review of the company’s strategy and business activities. He says the findings of the review will be announced to the market at the end of August.
On 16 June, Destra advised the market that its financial performance for the six months ending 30 June 2008 would be adversely affected by a deteriorating economic environment and falling demand. The company forecast a significant earnings loss for its second half, with an estimate of earnings before interest, tax, depreciation and amortisation of a loss of between $2.5 million and $3.5 million before impairment charges. The full year EBITDA estimate is a profit of coincidentally the same amount, between $2.5 million and $3.5 million.
Destra Vision includes Magna Pacific, MRA Entertainment group and Visual Entertainment Group. Destra Music includes Central Station, Rajon Distribution, the audio assets of MRA Entertainment and audio assets of Destra Corporation
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