Helios and Matheson Analytics to Spin Off MoviePass

Helios and Matheson Analytics (NASDAQ:HMNY) announced on Tuesday (October 23) the preliminary plan to spin off its MoviePass Entertainment as a separate publicly traded company.

Helios said that its board of directors approved a plan to create an integrated film production, marketing and exhibition company which would result in a new subsidiary, called MoviePass Entertainment Holdings.

The company said the new subsidiary would take ownership of MoviePass’ shares and other film-related assets held by Helios.

“We believe this new vertically integrated entertainment ecosystem, if achieved, would provide a sharper market focus, and that the combination of these four business lines under the MoviePass Entertainment umbrella would produce substantial synergies that we believe will generate value for our shareholders, subscribers, and business partners,” Ted Farnsworth, CEO of Helios, said in the release.

According to Helios, the new subsidiary as a publicly traded company would primarily consist of four assets, namely: the shares of the common stock of MoviePass, membership interests of MoviePass Films, MoviePass Ventures and Moviefone.

While MoviePass is a movie theater subscription service that’s held by Helios, MoviePass Films is a production company which is held by Helios in partnership with Emmett Furla Oasis Films.

Similarly, MoviePass Ventures is an acquirer and owner of economic interests in completed films, while Movifone is a multimedia information and advertising service.

“Since we acquired control of MoviePass in December 2017, [Helios] largely has become synonymous with MoviePass in the public’s eye, leading us to believe that our shareholders and the market perception of [Helios] might benefit from separating our movie-related assets from the rest of our company,” Farnsworth said.

Helios, if permitted under Delaware law, also plans to distribute a minority of the outstanding shares of MoviePass Entertainment as a dividend to its shareholders. Although, no record date is currently set, the company plans to retain control of MoviePass Entertainment upon such a distribution.

The company said that it plans to discontinue its previously announced plan to spin off Zone Technologies, a safety and navigation app provider for iOS and Android platforms.

Following the announcement, shares of Helios were up 15.38 percent and closed the trading session on Tuesday at US$0.019.

The stock had a day high of US$0.026 and a low of US$0.018. Helios’ share price had a 52-week of high of US$39 and has lost more than 100 percent in the last year. The stock has a “Sell” ranking on TradingView with 10 verticals against, eight in neutral and eight in favor.

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Securities Disclosure: I, Bala Yogesh, hold no direct investment interest in any company mentioned in this article.