DHX Media to merge with Entertainment One
(Reuters) - Canada-based children's television program producer DHX Media Ltd DHXM.L DHX.TO has agreed to a reverse takeover of Entertainment One Ltd ETO.L, the companies said on Monday.
The deal, expected to be completed by the end of December, values DHX at C$1.59 a share, or about 68 million Canadian dollars ($65.76 million).
Entertainment One buys and distributes film, TV and music content in Canada, the UK, the U.S. and elsewhere.
The combined company, also to be named Entertainment One, will be listed on both the AIM and the Toronto Stock Exchange.
"The enlarged group will provide DHX with access to the U.S. and international home entertainment markets and will offer further distribution capabilities for our growing children's library," said DHX Chief Executive Michael Donovan.
Entertainment One's Chief Executive Darren Throop will be the chief executive of the enlarged group, the companies said.
In a separate statement, DHX reported a pretax loss of C$989,000 for the year to June 30, 2008, compared with a profit of C$1.79 million a year earlier, due to an impairment hit on investments, particularly the movie 'Shake Hands with the Devil'. Revenue doubled to C$52.5 million.
The enlarged group will have a pro-forma revenue of about 350 million pounds (C$665 million) and adjusted EBITDA of about 29 million pounds (C$56 million), DHX said.
At 4:45 a.m. EDT, DHX shares were up 16 percent at 57.5 pence. Entertainment One was down 1 percent at 81.5 pence.
(Reporting by Kumar Alagappan in Bangalore; Editing by Rosalba O'Brien)
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