Chicken Soup for the Soul Entertainment Inc. signed a definitive agreement to acquire Pivotshare Inc., a global subscription-based video-on-demand service.

The company offered series A preferred shares as an acquisition currency to Pivotshare shareholders, who agreed to accept $3.35 million of the $4.35 million purchase price, excluding costs, in the form of the company's perpetual preferred stock.

Chicken Soup for the Soul Entertainment, or CSS Entertainment, priced an offering of $15 million of series A redeemable perpetual preferred stock in June.

"This accretive acquisition of Pivotshare launches us into the subscription VOD space, significantly accelerating our business plan," William Rouhana, Jr., CSS Entertainment chairman and CEO, said in an Aug. 14 statement. "This multi-channel online network comes with pre-existing content, much of which fits with the Chicken Soup for the Soul brand," he added.

Pivotshare is comprised of a series of SVOD channels online with 28,000 hours of programming. It generates about $2.5 million in annual revenue and has approximately 25,000 paid subscriptions, with an average monthly revenue of $9 per subscription.

"Pivotshare is expected to generate approximately $1 million per year in cost savings for CSS Entertainment, which is a 23% return on our investment annually," said CSS Entertainment Vice Chairman Scott Seaton.