News

Entertainment One becomes global force in filmed content and expands Canadian distribution market share

07 July 2008

Highlights

• Acquisition of leading television production companies Blueprint and Barna-Alper and international television distributor, Oasis creates a new industry powerhouse
• Acquisition of Maximum Films expands Canadian theatrical market share and positions the company as the pre-eminent Canadian owned film exporter to international markets

TORONTO, July 7 /CNW/ - Darren Throop, CEO of Entertainment One (E1), the international entertainment content owner and distributor announced today the signing of an agreement to acquire three leading television content suppliers: Blueprint, Barna-Alper and Oasis International. Concurrently, an agreement has been reached to acquire Maximum Films' Canadian and International Distribution operations and combine it with E1's Seville Pictures. These agreements mark a major milestone in the company's aggressive strategy to become a leading global distributor of entertainment content.

"Combining these three television companies creates an unrivalled cross-border force in television in North America supplying programs to most major broadcasters on both sides of the border," said Darren Throop. "Furthermore, the consolidation of Maximum Films together with E1's Seville Pictures will result in an enhanced theatrical market-share in Canada and a company which is enviably well positioned for international sales and distribution," he added. "We are now able to create television programs at a unique risk-return profile and direct this content as well as our increased film content to our multiple territory distribution companies and realize all of the synergies of this direct access."

In conjunction with these acquisitions, the Board is also actively considering opportunities to enhance shareholder value via a move to a dual-listing on the Toronto Stock Exchange and the Main List in London in the current financial year.

These acquisitions establish E1 as a fully integrated film, television, music, sales, marketing and distribution company, with on the ground distribution operations and libraries in Canada, the US, the UK, Holland and Belgium. In addition, the company will control an important and growing library of world-wide rights consisting of over 9,300 hours of programming which will be licensed to both international and domestic distributors and broadcasters by its tandem international sales operations - Oasis for television product and Seville for theatrical films.

Headed by President Patrice Theroux, E1's Filmed Entertainment Division will now include Blueprint, Barna-Alper, Oasis International, the newly-combined Seville Pictures/Maximum Films - along with the previously acquired Contender Entertainment Group in the UK and RCV Entertainment in Holland and Belgium.

"With these acquisitions E1's Filmed Entertainment Division is well-positioned strategically to take advantage of a wide-range of commercial opportunities which are now available to the company," said Theroux. "The principals of each of these companies are universally recognized as among the most talented producers of film and television content in the industry, and it is a privilege to welcome this exceptional group of executives to E1," he added.

Blueprint Entertainment

Los Angeles based Blueprint, founded by former senior Alliance Atlantis television executives John Morayniss and Noreen Halpern in 2002, has rapidly become a key supplier of television series and movies to US cable networks. Today, Blueprint is the foremost cross-border supplier of quality television programming. Some of the shows produced for US networks include:

• Comedy Central - the hit show "Kenny vs Spenny"
• MTV - "Man in The Mirror: The Michael Jackson Story"
• Vh1 - "Hey Joel"
• The N - "The Best Years"
• Lifetime - "Absolution"
• Hallmark Channel - "Mail Order Bride"
• HBO - the highly anticipated "Hung"
• Tru TV - "'Til Death Do Us Part"
• Logo - "Exes and Ohs"
• AMC - "The Wrong Coast"
• Oxygen Channel - "Good Girl Bad Girl"
• CW - "Two Kings"
• ABC Family - "Greek"

In its six years of operations, Blueprint has produced 210 hours of proprietary programming. The company's shareholders include former CBS President Jeff Sagansky and former Alliance Communications CEO Robert Lantos, both of whom will now be E1 shareholders.

Barna-Alper Productions

Toronto based Barna-Alper, led by its founders Laszlo Barna and Laura Alper, has been a leading producer of Canadian television programs for over 25 years. The company has produced 620 hours of proprietary drama and documentary material for a wide range of broadcasters. Barna-Alper's Canadian clients include:

• CTV - "The Bridge"
• CBC - "Da Vinci's Inquest"
• Global - "Da Kink In My Hair"
• History - "Turning Points of History"
• Showcase - "G-Spot"
• Discovery - "Megabuilders"

In Canada, Barna-Alper is a stamp of quality, a top brand synonymous with excellence. The company's shows have won 53 Gemini Awards, many international awards and have been widely licensed in the international marketplace.

Oasis International

With offices in both Toronto and Los Angeles, distributor Oasis International was launched in 1991 by Peter Emerson. Since its founding, Oasis has worked aggressively to secure a strategic position for itself and its product in the international television landscape. Oasis' sales catalogue of more than 3,000 hours of programming includes:

• Dramatic series such as "ReGenesis"
• Television movies such as "Celine"
• Reality programming such as "Keys to the VIP"
• Children's programming such as "Iggy Arbuckle"
• Lifestyle programming such as "House & Home"
• Documentaries such as "Uganda Rising"

Oasis has licensed product to over 500 different networks in 150 countries including TF1, and Canal+ in France; RTL, and ZDF in Germany; BBC and ITV in the UK; Antena 3, and Telecino in Spain; RAI, and Mediaset in Italy; and NBC Universal and Lifetime in the US. The company commands a prominent space at international television sales markets, such as MIPTV and NATPE. Going forward, Oasis will license internationally all programs produced by Blueprint and Barna-Alper, as well as product from third party producers.

Said John Morayniss and Laszlo Barna on behalf of the newly merged Television Group:

"We are very excited by the opportunity offered by the combination of our respective businesses. Content creation, when combined with a strong distribution platform, is a very powerful proposition in our industry. The ability to reach the lucrative television, on-demand and DVD markets directly and to increase our offering of television programs with feature films will be a key driver for E1's growth. We fully embrace E1's strategy and look forward to contributing to the success and the rise of this new force in the entertainment industry."

Maximum Films

Launched a year ago by Robert Lantos, in partnership with Mark Musselman and Academy Award nominated South African producer Anant Singh ("Yesterday"), Maximum Films has two businesses: (i) Canadian Film Distribution, headed by Bryan Gliserman who, for 15 years, was head of Odeon Films, a division of Alliance; and (ii) International Film Sales, headed by Charlotte Mickie, who led Alliance's international film sales division for 13 years and subsequently worked for Paris-based international sales agent Celluloid Dreams for five years.

Among Maximum's recently-released films are "Bella", "Fugitive Pieces" and "Before the Rains". The company has announced Canadian distribution agreements with Lakeshore Entertainment ("Million Dollar Baby"); IFC ("Y Tu Mama Tambien"); Cinetic Media ("Little Miss Sunshine"); and is the exclusive distributor of all the films produced by Robert Lantos' Serendipity Point Films ("Eastern Promises"). Maximum's international operations will be combined with E1's Montreal-based Seville Pictures, headed by David Reckziegel, which has recently signed output deals with Summit Entertainment - the forthcoming Nicolas Cage movie "Knowing" and the upcoming film "Twilight", adapted from the international best-selling novel; and Yari Film Group ("Crash"). Reckziegel and Gliserman will be co-presidents of Seville/Maximum.

In less than a year, Maximum has assembled an international sales catalogue of 25 films from quality independent producers around the world, such as the upcoming "Cold Souls" starring Paul Giamatti; Atom Egoyan's recent Cannes prize winner "Adoration"; Sundance Grand Jury Prize Winner "Trouble the Water"; and the currently in release critically lauded "My Winnipeg". Maximum's international operations will be combined with Seville International, which handles a catalogue of over 145 films from around the world. Charlotte Mickie, reporting to Reckziegel, will oversee the division and Anick Poirier will continue to serve as vice-president, Seville International.

Long Term Management Contracts

The company and the senior management of each of these companies have agreed to enter into long-term employment agreements. John Morayniss is appointed CEO, Television Group, reporting to Theroux. Laszlo Barna will serve as President, Television Production and Peter Emerson will serve as President, International Television Distribution, each reporting to Morayniss. Noreen Halpern is assuming the title of President, Television Production, US, reporting to Barna. Margaret O'Brien will be appointed COO of the Television Group, and will report to Morayniss. Both Gliserman and Mickie have also agreed to new long-term employment agreements.

Robert Lantos, an investor in all four companies being acquired, will join the E1 Board of Directors. Mr Lantos, producer of Golden Globe Winning and Academy Award Nominated films "Eastern Promises", "Being Julia", and "Sunshine", has signed a non-competition agreement with E1 which will distribute his past and future films.

These acquisitions are also anticipated to create synergies that will significantly reduce overall company overhead and operations costs, with a number of opportunities for sharing resources and reducing expenses already being implemented. It is estimated that it will result in synergies representing in excess of US$1.5 million through cost savings and additional value created for the programs produced, resulting from the direct distribution through E1 multi-territory distribution network.

The purchase price for these companies will be a combination of shares and cash, with the shares representing the majority of the payment, which aligns the interests of the senior management of these companies with those of E1 shareholders.

About Entertainment One:

Entertainment One Ltd. (LSE: ETO) AIM listed, Entertainment One Ltd.'s strategy is to build a leading global independent entertainment content ownership and distribution business which acquires films, television programs and music content and exploits these rights in all media throughout the world. Entertainment One is one of the world's leading international entertainment companies with operations in Canada, the U.S., Holland, Belgium and the UK, where it distributes, acquires and owns filmed entertainment and music content in all medias. Entertainment One also owns Koch Entertainment, the largest independent record label in North America and a leading independent distributor of music and video in the United States. www.entertainmentonegroup.com

Blueprint Entertainment - (http://www.blueprint-corp.com/)

Oasis International - (http://www.oasisinternational.com/)

Barna-Alper Productions - (http://www.barnaalper.ca)

Maximum Films - (http://www.maximumfilms.ca/)

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