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DreamWorks Animation SKG Inc. (DWA), the movie studio run by Jeffrey Katzenberg, agreed to acquire Classic Media for $155 million, adding a library of vintage film and television characters including Casper and Lassie.
Classic’s co-chief executives, Eric Ellenbogen and John Engelman, will run the new DreamWorks Classics unit, according to an e-mail yesterday from Shannon Olivas, a spokeswoman for Glendale, California-based DreamWorks Animation. Classic Media is owned by an affiliate of private equity firm GTCR LLC.
The acquisition marks further expansion for DreamWorks Animation, which formed a venture in China this year, adding characters that can bolster Katzenberg’s film and TV lineup. Ellenbogen, who co-founded Classic Media in May 2000, had been CEO of Marvel Entertainment, where he signed the long-term deal with Sony Pictures to produce the Spider-Man films, according to a profile on the GTCR Website.
“This is arguably one of the largest, most valuable collection of characters and branded assets left in the world today,” Katzenberg said in an interview. “We see this really providing DreamWorks with whole new sets of opportunities.”
DreamWorks Animation plans to use Classic Media’s characters in all of its operations, including film, TV, home entertainment, consumer products, digital, theme parks and live outlets, Katzenberg said.
The studio plans to release a 3-D feature film titled “Mr. Peabody & Sherman,” based on Classic Media characters, on Dec. 25, 2013.
Classic Media, based in New York, has acquired the rights to more than 6,100 episodes of vintage cartoons and TV shows such as “Rocky & Bullwinkle,” “Casper the Friendly Ghost,” “The Lone Ranger” and “Lassie” in parts since 2000.
For the 12 months ended Feb. 29, Classic Media posted an operating profit of $19.2 million on sales of $82.2 million, according to the statement. DreamWorks expects the purchase to add to profit in the first full year after the deal closes.
Classic Media said it is the third-largest holder of comic book rights, including the Harvey brand. It also owns Big Idea, maker of the religious-themed children’s series VeggieTales.
DreamWorks Animation expects to announce a new film- distribution accord in two weeks, Katzenberg said. He declined to provide specifics or say whether the company had ruled out distributing movies itself when the current deal with Viacom Inc. (VIAB)’s Paramount Pictures ends this year.
DreamWorks Animation fell 0.4 percent to $19.08 at the close in New York. The studio, spun off (DWA) from DreamWorks SKG and taken public by Katzenberg in 2004, has fallen 57 percent from an all-time closing high of $44 a share on March 24, 2010, as the company, like others in Hollywood, has sold fewer DVDs.
The company’s most recent theatrical release, “Madagascar 3: Europe’s Most Wanted,” has generated $476.4 million in worldwide ticket sales since June 8, according to researcher Box Office Mojo. The website estimates the production budget at $145 million.
DreamWorks Animation’s next movie, “Rise of the Guardians,” is a computer-generated picture featuring the fictional character Jack Frost battling evil in the world. It is scheduled for a Nov. 21 release and features the voices of Hugh Jackman, Chris Pine and Alec Baldwin, according to the Internet Movie Database.
The deal for Classic Media was reported yesterday by the Wall Street Journal.
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