Reedeux Media seeks IPO after first coin offering sells out

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(Reuters) – U.S. tech startup Reedeux Media said it plans to list on the Nasdaq exchange later this year, seeking a valuation of up to $1 billion after selling out the first tranche of its media cryptocurrency coin offering on Thursday.

Reedeux, which has an app that allows consumers to instantly buy products advertised on TV shows, said it sold $2.5 million worth of the tokens in a first pre-sale on Wednesday.

The company expects to launch its digital platform in April and follow that with an initial public offering worth at least $100 million.

Online streaming services, including Inc’s Amazon Prime, Netflix and Hulu, will air shows that the company plans to produce using the money raised from its coin offering, according to documents seen by Reuters. The company has also tied up with Comcast Corp’s NBC Universal and Walt Disney Co’s Disney ABC.

The company has also partnered with Samsung’s U.S. business to integrate its CONNEXT app with the South Korean electronics giant’s phones, laptops and televisions while also showcasing these products on television shows.

Los Angeles, California-based Reedeux is currently in the process of hiring underwriters for the initial public offering, with Credit Suisse being the front runner, a source close to the deal told Reuters.

The source declined to be identified because the talks are ongoing and confidential.

The company is expected to be cash-flow positive by late April to early May, Federico Pacquing, chief executive of Reedeux, told Reuters.

Reedeux expects each hour-long episode of shows to have up to 4,000 different products featured and estimates it will have upfront payments from sponsors and partners of $30 million by the time of launch.

The company’s app seeks to offer struggling retailers easier distribution and advertising channels for their products by syncing with the TV show they are watching.

Reedeux hopes to issue $100 million of its “Medadyn” utility tokens, which will give buyers rights to access products or services rather than a stake in the company.

Participants who buy the token will become financial partners to particular media projects and the buyers of the coins would receive a portion of the revenue generated by the product placement in the show and the sales of the product.

The company’s initial coin offering comes at a time when regulators in various countries have been intensifying scrutiny of digital currency fund-raising.

Bitcoin, which skyrocketed nearly 2,000 percent last year and hovered near a peak of $20,000, slumped to around $11,600 on the Luxembourg-based Bitstamp exchange on Thursday.

Reporting by Arathy S Nair in Bengaluru; Editing by Patrick Graham, Bernard Orr