Breaking News: DreamWorks Acquires Classic Media

DreamWorks Animation SKG, Inc., announced this morning that it is acquiring Classic Media for $155 million in cash from Boomerang Media Holdings I LLC, a portfolio company of Chicago-based private equity firm GTCR.

Classic Media’s library of intellectual properties features a vast collection of filmed entertainment with more than 450 titles and more than 6,100 episodes of animated and live-action family-focused programming. Classic Media owns one of the world’s largest comic book archives and media rights to the titles in the Golden Books library, which have sold more than two billion copies worldwide, according to the companies.

Classic Media’s portfolio includes Casper the Friendly Ghost, Where’s Waldo?, Lassie, The Lone Ranger, George of the Jungle, and Rocky & Bullwinkle. In addition, the company also has holiday favorites Frosty the Snowman, Rudolph the Red-Nosed Reindeer, and Santa Claus is Comin’ to Town. Classic Media counts among its holdings contemporary bestsellers such as VeggieTales and Olivia, as well as Postman Pat and Noddy in international markets.

“Classic Media brings a large and diverse collection of characters and branded assets that is extremely complementary to DreamWorks Animation’s franchise business, and we plan to leverage it across our motion picture, television, home entertainment, consumer products, digital, theme park, and live entertainment channels,” said Jeffrey Katzenberg, CEO of DreamWorks Animation, in a statement issued this morning. “Founders and co-CEOs Eric Ellenbogen and John Engelman—seasoned executives with more than 20 years of industry experience and a proven track record of success in managing high-quality content—have built an amazing team at Classic Media and are a welcome addition to the DreamWorks Animation family.”

Classic Media has approximately 80 employees and is headquartered in New York City, with offices in the UK and a division, Big Idea Entertainment, in Nashville, Tenn.

“No company knows the family entertainment business better than DreamWorks Animation and we are excited to join their family in a natural extension of our long-standing relationship that began years ago on Mr. Peabody & Sherman,” said Eric Ellenbogen, co-CEO of Classic Media, in a statement.

Classic Media’s joint venture with Jay Ward Productions manages the rights to the entire Jay Ward animated catalog, which includes Rocky & Bullwinkle and Mr. Peabody & Sherman. DreamWorks Animation’s 3-D feature film Mr. Peabody & Sherman is scheduled for release on December 25, 2013.

For the 12 months ended February 29, 2012, Classic Media earned net revenue of $82.2 million and operating profit of $19.2 million, according to this morning’s statement. The acquisition of Classic Media will be financed through a combination of cash and borrowings under DreamWorks Animation’s revolving credit facility. The purchase price of $155 million includes amounts required to retire indebtedness.

DreamWorks Animation says it expects that the transaction will be completed during the quarter ended September 30, 2012.