Toronto-based Cinram International will pay $1.05bn to acquire the DVD and CD manufacturing and distribution businesses of AOL Time Warner in the US and Europe.
The deal, which should close in Autumn 2003, includes exclusive long-term agreements with Warner Home Video, Warner Music Group and New Line Cinema to manufacture, print, package and physically distribute their software in North America and Europe.
Cinram, one of the largest players in its field, has supplied these services to these companies for some 20 years but only in certain countries. The new arrangement broadly enhances the scope of the relationship.
Among the assets are manufacturing plants in the US and Germany along with related businesses including DVD packager and printer Ivy Hill Corp and Giant Merchandising, a specialist in entertainment marketing and retail licensing.
In a statement Cinram said it financed the purchase through a $1.2bn bank facility and expected the acquired businesses to generate approximately $1.1bn in revenue for the fiscal year ended November 2003.
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