Good morning. My name is Sylvie, and I will be your conference operator today. I would like to welcome everyone to Boat Rocker's Corporate Update Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. Instructions on how to queue up to ask questions will be given at that time. Before turning the call over to management, I would like to remind listeners that today's remarks include non-IFRS measures. Reconciliations between Boat Rocker's IFRS and non-IFRS results can be found in the company's Q1 MD&A dated May 15, 2024. Additionally, Management's Outlook for 2024 and beyond, Anticipated Financial and Operating Results, Plan and Objectives, and Answers to Your Questions will contain forward-looking information within the meaning of applicable securities laws.
These forward-looking statements reflect management's current opinions, beliefs, estimates, expectations, and assumptions, and are based on information currently available to management, which includes assumptions and continued review based on past performance, perceptions of trends, and current business conditions, expected future developments, and other factors which management considers appropriate and reasonable in the circumstances. This forward-looking information represents management's expectations as of today and, accordingly, is subject to change. Such information is based on current assumptions that may not materialize and are contained in Boat Rocker's annual MD&A dated March 28, 2024, and first quarter MD&A dated May 15, 2024, and is subject to a matter of important risks and uncertainties. Actual results may differ materially, and listeners are cautioned not to place undue reliance on this forward-looking information.
A description of the risks that may affect future results is contained in Boat Rocker's annual information form for the year ended December 31, 2023, which are available on the corporate website and in its filings with the Canadian Securities Administrators on SEDAR+ at www.sedarplus.ca. With that, I will now turn the call over to Mr. John Young, Chief Executive Officer of Boat Rocker Media. Mr. Young, you may begin with your remarks.
Thank you, Sylvie, and good morning, everyone. Thank you for joining us this morning to discuss some exciting corporate developments at Boat Rocker. As we announced this morning, we've sold our 51% stake in talent management company Untitled Entertainment to TPG for proceeds comprising of approximately $51.6 million in cash and approximately 8.8% in the common equity of the new talent management company being launched by TPG. We're thrilled with this deal as it provides exceptional value for shareholders, certainly healthy cash proceeds, and an equity stake in TPG's new talent management company. The yet-to-be-named company will acquire, invest in, and build a diversified global business centered on talent management, representation, and adjacent verticals. Our equity stake and board representation in the company maintains our ties to the representation and talent management space.
This deal will enable us to assertively continue to invest in our content-first strategy and other opportunities, of course, to accelerate our Adjusted EBITDA growth in the long term, including through M&A. This deal also further strengthens our partnership with Untitled's founders, Jason Weinberg and Stephanie Simon, and builds a new relationship with TPG, an outstanding leader in the entertainment space. As a leading investment firm with significant experience investing across the entertainment, talent management, media, and music industries, we couldn't have found a better partner than TPG. We're also delighted to continue to collaborate with two exceptional Boat Rocker alumni, Michel Pratte and Eric Taitz, who will transition from their long-standing positions at Boat Rocker, effective immediately, to become the inaugural CEO and COO of TPG's new company.
Michel has been an integral part of the Boat Rocker for over 15 years in various leadership roles, while Eric has also held key strategic positions at Boat Rocker since 2018. We wish them the very best in their new endeavors. Along with some operational changes as a result of this transaction, there are changes to Boat Rocker's outlook for fiscal 2024. We continue to be impacted by the delays in new content commissions and renewals, production and paid development, which are broadly impacting the media and entertainment industry at the moment. Taking into consideration these factors, as well as the sale of Untitled, Boat Rocker now anticipates full year 2024 Adjusted EBITDA to be approximately $10 million. With enhanced cash available for use in excess of $75 million and no corporate debt, Boat Rocker will continue to pursue an aggressive content investment strategy.
Although it may take some time for the IP investments to deliver and begin to realize their full value, we believe this strategy ideally positions us for sustainable long-term growth. We will continue to exercise prudent cost management and adjust our planning and strategy as needed to meet the demands of this shifting market. While some industry headwinds remain, we are using this year and next to proactively set a firm path beyond that, starting with this Untitled transaction. Across strategy, operations, and return on investment, this is a stellar deal that we believe delivers shareholder value and immense intrinsic value for Boat Rocker in the long term. We are steadfast in our conviction that using our capital and our corporate resources to maximize control over our destiny and provide the most flexibility in our IP strategy is the pathway to future growth.
We're looking forward to sharing in that growth with all our stakeholders as we move into Boat Rocker's next chapter. We'll provide the market with an update on that strategy and our progress when we report in a short time, our Q2 in mid-August. Thank you all for your time today. Thanks to everyone helping Boat Rocker move along in this strategic direction. I'm now going to open the call up for questions.
Thank you, sir. Ladies and gentlemen, if you would like to ask a question, please press Star followed by One on your touch-tone phone. You will then hear a three-tone prompt acknowledging your request. If you would like to withdraw from the question queue, simply press Star followed by Two. If you are using a speakerphone, we do ask that you please lift your handset before pressing any keys. Please go ahead and press Star One now if you do have any questions. Your first question will be from Drew McReynolds at RBC Capital Markets. Please go ahead.
Yeah, thanks very much. Good morning, John. Just maybe I'll start off with the change in guidance. There's obviously the sale in the announcement today, but alluding to kind of continued delays and a shifting market, I'm just wondering if you can kind of unpack kind of the reduction in guidance to all the various factors and just remind us kind of the confidence just given all the delays in terms of the timing of the recovery. Do you think there's any structural decrease in demand here, or is this strictly the industry getting back up on its feet? Thank you.
Thanks, Drew. So first question first on the guidance. I think the simple way to unpack that is we told the market at the start of the year that approximately $20 million was our target for Adjusted EBITDA. And in that, we had thought that Untitled and our representation segment was probably going to come back to somewhere around 2022 levels. So 2023 was a down year, as you know, in our representation segment, and we were factoring in in 2024 back to a sort of 2022 level for our segment profit in representation. And we were also factoring into that a stronger back half of 2024 versus the first half. So a simple way to look at it is when you think about those numbers, this is largely, very, very much largely, the back half of Untitled not being in our guidance in 2024. That's a simple way.
There are some puts and takes, but nothing necessarily material with what we had thought was going to happen in 2024. So really just the representation segment not being in our numbers in the back half of 2024. To your second.
Sorry.
Sorry.
Yeah, no.
I apologize, Drew.
Yeah, no, John, that's fine. I continue. Thank you.
Yeah. And your second point, Drew, is a question that I think all our industry is facing right now. I don't think it's necessarily a structural fundamental shift. I think it is just a slower pace coming out of peak TV in 2022, the strikes, COVID, and the strikes. We're not seeing it come back as strongly for a lot of reasons, including the buyers considering what they have, looking at their business models, and thinking how they themselves build going forward based on the content that they had ordered and produced over the last three, four, five years. So it's definitely not ramping up as fast. We're definitely not seeing buyers buy as much for sure, but content is being bought. There are still billions being spent out there on creating and buying new content.
We are still in the market actively ourselves pursuing that IP strategy of trying to buy and own and distribute our content. So it'll take a little time. I don't think we're out of the woods yet. I don't think we're going to see this come back at all to the levels we saw in 2022 anytime soon, but still lots of opportunity. And again, I think that's why this transaction and setting ourselves up for the cash balance that we have and no debt with, I think, some interesting opportunities coming down the line not only because of the shift and the somewhat struggles in the industry, but I think there's going to be also some interesting other opportunities, whether it's M&A or other assets coming to market that I think we'll be able to take a close look at.
Okay. Well, that's super, just two more here then, John. Can you just elaborate on the M&A environment? When you went public, it was a focus, but obviously a fairly volatile capital markets environment as well as operating environment. What's kind of changing on the M&A front in terms of the pipeline and your focus? And then secondly, just on any tax implications that we should be aware of for modeling purposes just on this transaction. Thank you.
I'll answer the second. And Drew, I don't think there's anything, again, you should think about. We've actually got a pretty solid tax position on this transaction in terms of being able to shield and manage the tax impact on the transaction very successfully in this case. So nothing to worry about there. I think you'll see that when we deliver our Q2s. There's nothing concerning there at all and be able to shield most of the gain.
In terms of the M&A, we said for the last couple of quarters that going after IP, investing to co-productions or putting capital to the finishing touches of a piece of IP that needs a distribution advance or a final piece of capital going in in order to make it happen, in order to put it into production, along with investing in our own IP, such as our documentaries, which are, of course, manageable from a budget perspective, we're able to see really solid MOICs and IRRs in that area. So that's been the focus for the last probably at least two or three quarters. I see that continuing as opposed to some of the production company acquisitions that you saw us make as we built our diversified business a number of years ago. So that's definitely the focus.
But in saying that, we're obviously seeing companies out there with a heavy load on their balance sheet of leverage, thinking about asset sales. We're seeing libraries come to market. And I think Dave and I think there is an opportunity and will be continued opportunity to pick up those types of assets, which I think offer more clearly a sustainable cash flow returning piece of business. We see that as a key focus. And I think that's where our M&A activity will focus.
Okay. No, that's all very helpful. Congrats on the announcement. I'll pass the line.
Thank you, Drew. Thank you.
Once again, ladies and gentlemen, if you do have any questions, please press Star followed by One on your touch-tone phone. And at this time, Mr. Young, it appears we have no other questions. Please proceed, sir.
Well, thank you very much, Sylvie. Thank you. Appreciate everyone joining us. As I said at the very start, we're very excited about where we go from here in a strong position to move forward. So thank you all. We'll be back in touch. We'll talk in about six weeks' time, I think, when our Q2 results are out.
My apologies, sir. We do have someone that had queued up. Do you have time to take them?
Oh, I don't know. Tell me who it is first.
David McFadden.
Okay then.
Please go ahead, David.
Okay. Excuse me. Well, thanks for sending me in. I thought it queued up earlier, but I guess not. Anyways, so you talked about the transaction being good return on investment. I was wondering if you could share with us the cost base of the investment or what the return is on a percentage basis.
I can't go into the details of that specifically, David, but maybe just some parameters. We've been looking at long-term returns above 20% IRRs. That's how we like to put our capital to work. I think we've done a very good job, including on this deal in achieving that. It's a great asset, one that we've always seen that delivers cash and it's asset light. It's just at this point, it's not necessarily core to where we see the business going. So it's a great opportunity for us to do that and stick around with a not insignificant value and share of this new platform that I think TPG will be able to put significant capital to work going forward. We're delighted to be part of that too. So yeah, a very solid, a very, very solid return on investment for Boat Rocker.
Okay. All right. Thank you.
Thank you, sir. That concludes the questions.
Great. Thank you, Sylvie. Thanks again, everyone. Hope you have a safe and productive day. Thank you.
Thank you, sir. Once again, ladies and gentlemen, thank you for attending. This does conclude your conference call for today. You may now disconnect your lines and have a good weekend.