Winnipeg Free Press - PRINT EDITION

Kids' show producer goes for bigger share of digital market

  • Print

CHILDREN'S show producer DHX Media Ltd. expects to increase global sales on digital platforms like Netflix and mobile devices following a $111-million deal to buy Toronto's Cookie Jar Entertainment.

Cookie Jar Entertainment, with shows such as Caillou and Inspector Gadget, is already the No. 1 supplier of kids' programming to online content provider Netflix, DHX Media chief executive and chairman Michael Donovan said Monday.

"The consumers can get programming exactly when they want it, not when it's on a schedule," Donovan said in an interview.

"Consumers are prepared to pay for that."

Halifax-based DHX, with shows like Kid vs. Kat, already sells content to Netflix and Donovan said the combined company will have even more content to sell to Netflix and a greater global sales potential.

"Families are increasingly accessing children's entertainment from sources other than traditional television and DVD sales," Donovan told a conference call to discuss the acquisition.

"Content is now available directly by way of computers, mobile, IPTV (Internet protocol television), standard television with an Internet connection, etc. For example, Cookie is a leader in the digital distribution of its library."

DHX Media (TSX:DHX) said the transaction will be paid through a combination of about $45 million in cash and shares and includes the assumption of $66 million of debt.

Announcement of the transaction caused DHX's shares to surge 24 per cent, gaining 27 cents to close at $1.41 on the Toronto Stock Exchange.

The combined company will have more than $125 million in revenues going forward, Donovan said.

Michael Hirsh, Cookie Jar's CEO, said the combined company will be an independent global market leader in all aspects of children's entertainment from distribution to production to licensing and merchandising.

"There is an insatiable appetite for kids' content in the new digital streaming universe and we are very well positioned with our extensive library of evergreen, popular and recognizable brands to satisfy the market demand," Hirsh said in a statement.

Privately held Cookie Jar also has digital distribution agreements in place with providers including DISH Network, Amazon.com and cable providers Comcast and Videotron (TSX:QBR.B), Donovan said.

DHX Media also produces programs such as Yo Gabba Gabba, Rastamouse, How to be Indie and That's So Weird.

Donovan billed the transaction as creating as Canada's largest children's entertainment company.

The acquisition will increase DHX's current library of children's programming to more than 8,550 half-hour episodes from about 2,550 half-hour episodes and will also expand merchandising opportunities.

He also said the merchandising, licensing and library and distribution segments of the combined companies will represent 58 per cent of total revenue.

There will be about $8 million in cost synergies in the first 12 months.

The companies have offices in the same cities such as Toronto and Los Angeles, he said. As for job cuts, Donovan said, "We have no plans one way or the other."

Cookie Jar also had $8 million in digital distribution revenue for the 12 months ending May 31, representing growth of 353 per cent versus the same period last year, Donovan said.

DHX media is the producer or co-producer of more than 60 original TV series.

Cookie Jar has offices throughout western Europe as part of its Copyright Promotions Licensing Group (CPLG), a leading licensor and merchandiser of third-party brands and characters.

-- The Canadian Press

Republished from the Winnipeg Free Press print edition August 21, 2012 B5

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

In the Key of Bart: Can’t It Be Nice This Time?

View more like this

Photo Store Gallery

  • June 25, 2013 - 130625  -  A storm lit up Winnipeg Tuesday, June 25, 2013. John Woods / Winnipeg Free Press - lightning
  • A Canada Goose cools off in a water pond Monday afternoon at Brookside Cemetary- See Bryksa’s Goose a day Challenge– Day 27-June 25, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos

Poll

Do you support a proposed ban on tanning beds for youth under 18?

View Results

View Related Story

Ads by Google