On October 4, 2023, two Canada-based media services providers joined forces when Montreal’s difuze acquired Toronto-based WANTED! difuze is a sizable player in the North American market for media localization, providing services such as finishing, localization, and accessibility.
The company generated revenues of CAD 32.8m (USD 24.2m) in 2022. difuze’s Co-founder and VP of Sales and Business Development, Nicolas Savoie, told Slator that 85% of the company’s revenues can be broadly classified as localization-related (including dubbing, accessibility, and media services, but excluding post-production).
Savoie said difuze first encountered WANTED! — a post-production studio that provides recording, editing, localization, and mixing services — when working on a client project in Toronto that required a local partner. The company engaged WANTED! via a referral and realized the two shared similar attributes and values.
Prior to the transaction, WANTED! was majority-owned by its President and Founder, John deNottbeck, along with a number of key executives as minority shareholders. According to Savoie, deNottbeck has worked at WANTED! for more than five decades — a grand total of 54 years. He will stay on with the combined organization for a short period before retiring.
Backed by a Long-Term Growth Partner
difuze Senior Manager, Ryan Lippert, whose company difuze acquired a few years ago, will take over the management of WANTED! The two brands will remain separate for now, but WANTED! will have “a clear connection to difuze,” Savoie said. WANTED!’s revenues remain confidential, but Savoie said the combined organization is 250 people strong.
Savoie views the deal as helping difuze to strengthen its presence in Toronto, which he described as the “media and entertainment capital of Canada, and North America’s most diverse city.” difuze also identified WANTED!’s recent ”foray” into audiobooks as offering growth potential for the business.
Although the terms of the WANTED! transaction are undisclosed, Savoie told Slator that “the valuation multiple aligns with past transactions carried out by difuze.” The transaction was supported by The Fonds de solidartié FTQ, a Québec-based institutional investor with more than 3,700 portfolio companies. The Fonds invested in difuze and plans to partner with difuze for long-term growth.
Expect a Localization Lull
Despite the actors’ and writers’ strikes in Hollywood, Savoie said the company is currently seeing “strong demand for our localization and media services, in spite of a slowdown in theatrical releases.” However, he added, “Our legacy post-production business is unfortunately affected by the concurrent strikes in Hollywood, because we tend to work mostly on American productions shooting locally (i.e., in Montreal).”
Savoie continued, “Clearly, the production stoppage means some content is not being localized today, and will only be in the future. Meanwhile, we run on content that was recently produced, but that will come to an end sooner or later. Will there be a lull? Quite likely.”
In Canada, which is difuze’s main market, the company is still able to benefit from “its own home-grown production, unaffected by the strike,” Savoie said. And, as he pointed out, “streaming services are increasingly producing overseas, which again is relatively insulated from the effects of the strikes. So, there’s still a fair amount of content flowing around which requires our services. But we still wish for a quick resolution of the remaining strike, no doubt!”