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Dreamworks Animation confirmed on Monday that is has entered into an agreement to acquire Classic Media for $155 million in cash.
The deal gives the studio access to characters owned by Classic including Casper the Friendly Ghost, Where’s Waldo, Lassie, The Lone Ranger, Postman Pat and George of the Jungle.
Dreamworks was an aggressive bidder, far outpacing other interested media companies. News of the agreement has been circulating for more than a week, but the parties have affirmed that the purchase price will be $155 million, which includes amounts required to retire indebtedness. The deal will be financed through a combination of cash and credit.
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“Classic Media brings a large and diverse collection of characters and branded assets that is extremely complementary to DreamWorks Animation’s franchise business, and we plan to leverage it across our motion picture, television, home entertainment, consumer products, digital, theme park and live entertainment channels,” said Jeffrey Katzenberg, CEO of DreamWorks Animation in a statement.
Headquartered in New York City, Classic Media has approximately 80 employees and offices in the UK and Nashville, Tennessee. For the 12 months ended February 29, 2012, the company earned net revenue of $82.2 million and operating profit of $19.2 million.
Classic doesn’t own all its properties outright. The company controls 80 percent of Rocky & Bullwinkle, for example, with the rest owned by his estate. Some of the properties have already been licensed to others as well. such as Lone Ranger to Disney for a big budget film.
Representing Dreamworks in the deal was financial advisor J.P. Morgan Chase & Co. and legal advisors at Cravath, Swaine & Moore and O’Melveny & Myers. On Classic’s behalf was financial advisor Jefferies & Company, Inc. and legal advisors at Kirkland & Ellis.
The transaction is expected be completed during the quarter ended September 30, 2012 under customary closing conditions.
Dreamworks Animation’s stock price is down more than 9 percent in the past year to $19 a share.
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