Exhibit 99.1
Image Entertainment Acquires Home
Vision Entertainment and Enters into Exclusive Multi-Year Home Video
Distribution Agreement with The Criterion Collection
Home Vision Recorded Net Revenues of
Approximately $29 Million for Calendar 2004
Image to Be Criterion's Exclusive Home
Video Distributor Through 2010
Image Entertainment, Inc. (Nasdaq:DISK), a leading independent
licensee, producer and distributor of home entertainment programming
in North America, today announced that it has acquired all of the
outstanding capital stock of Public Media, Inc. d.b.a. Home Vision
Entertainment. In connection with the acquisition, Image has also
signed a long-term exclusive home video distribution agreement with
The Criterion Collection expiring December 31, 2010.
Home Vision is a privately-held, Chicago-based publisher and
distributor of home entertainment programming, specializing in
independent and foreign films. In addition to releasing its own
exclusive titles under the Home Vision Entertainment label, the
company was also the co-distributor with Image of the renowned
Criterion Collection.
The Home Vision library contains over 130 active titles, including
the BBC productions of C.S. Lewis' classic books "The Chronicles of
Narnia," "Day of the Dolphin" starring Academy Award winner George C.
Scott, "Allegro Non Troppo," the animation classic "Animal Farm" based
on George Orwell's famous book, the "Zatoichi" collection (a.k.a. The
Blind Swordsman), and Fukasaku's criminal underworld series "The
Yakuza Papers." In addition to acquiring the Home Vision library,
Image plans to continue releasing new titles on a monthly basis under
the Home Vision Entertainment label.
Excluding revenue streams not acquired by Image, Home Vision
Entertainment generated net revenues of approximately $29 million in
calendar year 2004 from distribution of their exclusive titles and the
co-distributed Criterion Collection line.
Image currently intends to close Home Vision's Chicago
headquarters and warehouse facility and consolidate all of Home
Vision's operations into Image's existing facilities in Chatsworth and
Las Vegas. Image anticipates that the consolidation will be completed
by December 31, 2005. Home Vision's President and Chief Executive
Officer, Adrianne Furniss, will stay on in a consulting capacity for
Image for a period of three years, during which time Ms. Furniss will
assist with Image's consolidation and content acquisition efforts.
The exclusive distribution agreement with The Criterion Collection
formalizes a previously non-binding and non-exclusive distribution
arrangement whereby Image and Home Vision each supplied certain
retailers with Criterion's titles. The Criterion Collection is the
premier producer of "special edition" home video programming, in which
critically acclaimed domestic and foreign films are transferred to DVD
with the highest quality of picture and audio and special features
including interviews with producers, directors and talent,
behind-the-scenes footage, documentaries, featurettes, and more. The
Criterion Collection currently contains approximately 280 active DVD
titles in its library and typically releases 3-4 new titles each
month.
The Criterion Collection has produced special editions of titles
such as Akira Kurosawa's "Seven Samurai," Martin Scorsese's "Last
Temptation of Christ," Terry Gilliam's "Fear and Loathing in Las
Vegas" based on the Hunter S. Thompson novel, award-winning feature
documentary "Hoop Dreams," and Gus Van Sant's "My Own Private Idaho"
starring Keanu Reeves. The Criterion Collection has also published
DVDs of The Merchant Ivory Collection, including "Howards End"
starring Anthony Hopkins and Vanessa Redgrave, and "Maurice" starring
Hugh Grant and Ben Kingsley. Through its affiliate Janus Films, The
Criterion Collection is also responsible for another library of
excellent programming, including Kurosawa's "Rashomon" and Cocteau's
"Beauty and the Beast." Pursuant to the distribution agreement, Image
will be the exclusive distributor for all of these programming lines
and titles on DVD and all other video formats.
Ms. Furniss stated, "Home Vision Entertainment, Janus, The
Criterion Collection and Image have had a long and productive history
together. The executives all know each other and their respective
businesses very well, making this transaction an especially good fit.
We are particularly excited that Image recognizes the value of
continuing the higher priced Home Vision Entertainment line and
supports our goal to identify 'the classics of the future.' Image
appreciates the label's reputation in the market, our passion for new
film talent, and our ability to release finely produced, expertly
mastered and supplement-friendly DVDs."
Charles Benton, Chairman and founder of Home Vision, continued,
"We've survived and prospered through many format changes and are
proud of our relationships with producers and the quality titles and
services we've been able to provide to our customers. We're happy that
Image will keep alive and well the Home Vision Entertainment name and
our tradition of publishing 'good films that sell.' We appreciate that
our DVD line will be part of an organization that has greater
resources and market reach in a time of market consolidation and
future technology change."
Martin Greenwald, Image's President and CEO, commented,
"Approximately one year ago we stated that there were opportunities
for Image to grow its business both organically as well as through
corporate acquisition. Last year we enjoyed stellar revenue growth
through the expansion and acceptance of our programming. Now, with the
acquisition of Home Vision and the signing of a multi-year exclusive
distribution pact with Criterion, the stage has been set to keep this
growth engine running. On an annualized basis, the acquisition and
distribution agreement will add a significant amount of new revenue.
Even more important is the opportunity to eliminate much of Home
Vision's overhead as it is absorbed into Image's existing
infrastructure."
Mr. Greenwald continued, "Now that the transaction has been
concluded, we plan to intensify efforts to identify and pursue further
opportunities. Our strategy is clear: to continue acquiring exclusive
content for a broad range of current and future distribution channels.
Image Entertainment is widely recognized as a leading independent
provider of domestic home entertainment content, and I believe that we
have the ability and the market sense to expand on that reputation
even further."
Jonathan Turell, CEO of Criterion, said, "We have worked closely
with Image for over 15 years in distributing The Criterion Collection,
and we look forward to increased marketing and sales efforts with
respect to our programming as a result of our new exclusive
distribution agreement. Over the years, Image has been a very vocal
supporter of ours, and they have a tremendous understanding of The
Criterion Collection's importance in the DVD market. Image's great
group of people should give us an even larger presence in the market."
Criterion's President Peter Becker stated, "After well over a
decade's experience with us and our brand, Image understands what The
Criterion Collection means, both to our core customers and to the
retailers who help us reach a wider audience. During that time, we've
seen what Image can achieve, and we look forward to continued strong
results, not only with our bestsellers but also across the entire
catalogue."
Image's Chief Operating Officer David Borshell said, "The
acquisition of Home Vision provides Image with a solid foundation upon
which to build a fine arts and foreign film label. In addition, we now
have the exclusive rights to market and sell The Criterion Collection,
which is both an honor and an exciting business opportunity. Our next
step will be to expedite the consolidation, a process that has already
begun and that we hope will materially conclude before the holiday
selling season. We believe we will only need to add a minimal number
of positions to our employee roster in order to accommodate both the
Home Vision and Criterion business, and we predict the consolidation
will be very efficient, driving the bulk of operational savings to the
bottom line."
Mr. Borshell concluded, "Image will do everything possible to
represent the Home Vision Entertainment label with the same passion
and commitment that suppliers and customers have come to expect.
Everyone at Home Vision should be proud of their company's 19 years of
accomplishments."
Corporate Conference Call
Image Entertainment's management will host a conference call on
Thursday, August 4, at 4:30 p.m. ET to discuss the financial aspects
of the transaction (e.g. purchase price, source of funds, etc.) and
the impact of the acquisition and the signing of the exclusive
distribution agreement upon Image's current and future revenues.
Martin W. Greenwald, CEO, Jeff Framer, CFO, and David Borshell, COO,
will be on-line to discuss these items and take part in a Q & A
session. The call can be accessed by dialing 866-550-6338 and
requesting to join the conference call by entering the confirmation
code 1810464, or by webcast at www.image-entertainment.com. Dial-ins
begin at approximately 4:20 PM EASTERN, or at any time during the
conference call. International participants, please dial (850)
521-5100 using the same confirmation code.
A replay of the conference call will be available beginning two
hours after the call and for the following five business days by
dialing 888-203-1112 and entering the following passcode: 1810464.
International participants, please dial (719) 457-0820 using the same
passcode.
About Image Entertainment:
Image Entertainment, Inc. is a leading independent licensee,
producer and distributor of home entertainment programming in North
America, with more than 2,800 exclusive DVD titles and 175 exclusive
CD titles in domestic release and approximately 300 programs
internationally via sublicense agreements. For many of its titles, the
Company has exclusive audio and broadcast rights and, through its
subsidiary Egami Media, Inc., exclusive video on demand, streaming
video and download rights. The Company is headquartered in Chatsworth,
California, and has a domestic distribution facility in Las Vegas,
Nevada. For more information about Image Entertainment, Inc., please
go to www.image-entertainment.com.
About The Criterion Collection:
The Criterion Collection, a continuing series of important classic
and contemporary films, is dedicated to gathering the greatest films
from around the world and publishing them in editions that offer the
highest technical quality and award-winning, original supplements. To
date, more than 35 filmmakers have made its Director-approved library
of DVDs the most significant archive of contemporary filmmaking
available to the home viewer.
About Home Vision Entertainment:
Founded in 1986, Home Vision Entertainment was among the first
companies to recognize the potential for independent and world movies
in the home video market. Recently, Home Vision has begun to focus on
acquiring new films, many of which are released on DVD after
theatrical runs on screens across the country. Home Vision publishes
and distributes DVDs across a wide variety of genres, from action
adventure and comedies to feature length documentaries and cult
classics. The high standards of its catalog and DVD presentation, as
well as our long-term distribution relationship with The Criterion
Collection and Janus Films, have led critic Leonard Maltin to say, "I
can't think of a finer collection of international cinema."
Forward-Looking Statements:
This press release may contain forward-looking statements which
are based on the Company's current expectations, forecasts and
assumptions. In some cases forward-looking statements may be
identified by forward-looking words like "would," "intend," "hope,"
"will," "may," "should," "expect," "anticipate," "believe,"
"estimate," "predict," "continue," or similar words. Forward-looking
statements involve risks and uncertainties which could cause actual
outcomes and results to differ materially from the Company's
expectations, forecasts and assumptions. These risks and uncertainties
include risks and uncertainties not in the control of the Company,
including, without limitation, the current economic climate and other
risks and uncertainties, including those enumerated and described in
the Company's filings with the Securities and Exchange Commission,
which filings are available on the SEC's website at www.sec.gov.
Unless otherwise required by law, the Company disclaims any intention
or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, or otherwise.
CONTACT: Press/Corporate Contact:
The Honig Company, Inc.
Steve Honig, 310-246-1801
press@honigcompany.com
or
Investor Relations:
MKR Group, LLC
Charles Messman or Todd Kehrli, 818-556-3700
ir@mkr-group.com