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MEDIA RELEASE DECEMBER 2 1999-12-02
MAGNA AND BECKER JOIN FORCES IN NEW BLOCKBUSTER DEAL
One of Australia's leading independent entertainment companies Magna Pacific (Holdings) Limited today announced that it had
joined forces with major productio house and distributor Becker Group in a new Video/DVD distribution deal.
Magna Pacific (Holdings) Limited Managing Director , Allan Radley said today that the addition of Becker's blockbuster titles to
Magna's already extensive catalogue would take Magna into the major league of Video/DVD retail sales and rental distribution.
Under the deal which commences on January 1 2000, the first blockbuster release will be The Blair Witch Project which has
taken in excess of US$200M at the US box office and is scheduled for release on over 270 screens throughout Australia on
December 9 1999.
A formal heads of agreement between the two parties was signed today. It will allow Magna Pacific to take over the rental and
sell through distribution of Becker's yet-to-be released video cassette and DVD titles and also the sell-through distribution for
Becker's extensive back catalogue of titles.
The commercial arrangements of the deal will see Becker take a 30% equity position in Magna Pacific Pty Ltd, which is a wholly
owned subsidiary of Magna Pacific (Holdings) Limited.
Magna Pacific (Holdings) Limited will grant to Becker for $1 (one dollar) , 1 Million unlisted options to acquire shares in MPH Ltd
at an exercise price of 55 cents excercisable at any time prior to January 1 2004.
Magna Pacific Pty Limited will advance a further $500,000 to Becker , convertible at any time over the next two years into
Becker Group Limited shares at 30 cents, under an interest free convertible note arrangement.
Becker will also nominate two new directors to the Magna Pacific Pty Ltd Board and have the option to purchase a further 19%
of Magna Pacific Pty Ltd in exchange for a cash injection of AUD$3.8M.
Mr Radley said that the deal fully exploioted synergies between the two groups.
"This is a very exciting Australian entertainment industry marriage combining Magna's expertise in manufacture, distribution and
fund raising with Becker's proven ability to source and theatrically distribute movies."
"We are delighted to be joining with such a well-known and significant player in the entertainment industry such as Becker. This
deal will foster a close relationship between the two companies and I foresee many opportunities for us to exploit together in the
future for our mutual benefit."
"Magna sees the relationship with becker growing from a small-screen romance to a blockbuster epic."
Becker's titles to be release in the future include Jim Carey's Man on The Moon, Michael Douglas's Wonder Boys, Bette
Midler's Isn't She Great and Buena Vista Social Club. Its back catalogue includes such titles as Dances With Wolves, Four
Weddings and a Funeral and Scream.
Becker Group Managing Director, Richard Becker, said "this was a new direction for Becker Home Video titles."
"The opportunity to work closely with an established Australian video distributor will give our titles the individual attention and
provide the focus needed on our theatrical movies."
"With such a strong line up of films for 2000 the timing couldn't have been better for both Becker and Magna."
Mr Radley said the distribution deal with Becker was consistent with the Magna Pacific Board's commitment to concentrate on
operations and acquisitions which generated consistent earnings and cash flow contributions.
"The addition of Becker titles has the potential to double our revenue for the financial years ending June 30th 2000."
He said Magna had revised revenue and profit forecasts to account for the benefits of the Becker deal. Management is
forecasting that Magna pacific Pty Ltd and its wholly owned subsidiary Rocvale Entertainment will generate FY 2000 revenue of
between $10M and $12M for net profit before tax of between $1.2M and $1.5M. In FY 2001, revenues are forecast to grow to
between $18M and $20M for net profit before tax of between $2.5M and $3M.
Magna Pacific has been one of the fastest growing listed companies in Australia for the past four years and has seen annual
revenue grow in excess of 50% pa compounded over that period. In FY 1999 Magna recorded a 79% increase in sales to $6M for
net profit of $403,000.
It has one of the largest independent film libraries in Australia, with approximately 1000 movie, documentary and children's titles. It
recently acquired video and DVD right to the mini-series blockbuster Joan of Arc.
Becker is one of Australia's premium entertainment companies with a long history in television production and distribution of
feature films through its two distribution operations, REP and Dendy.
Magna Pacific (Holdings) Limited Directors will continue to inform the market of substantial changes to revenue and profit as
management figures become available. After this transaction Magna Pacific (Holdings) Limited still has liquid assets in excess of
$2M and is still pursuing acquisition opportunities.
For further information please contact Allan Radley,
Managing Director, Magna Pacific (Holdings) Limited
07 3267 1113
Allan@magnapacific.com.au
Quelle:
www.magnapacific.com.au/corporate/...release/pressrelease.html
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