Imation Announces Close on Acquisition of Memcorp Assets
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OAKDALE, Minn., July 10 -- Imation Corp. (NYSE:IMN), a worldwide leader in removable data storage, today announced it has completed the previously announced acquisition of the assets of Memcorp, Inc. and Memcorp Asia Limited (together known as "Memcorp") from privately held Hopper Radio of Florida, Inc.
The purchase price was $27.3 million in cash and $37.5 million in three-year notes, plus a potential earn-out of up to $20 million over three years, dependent on financial performance of the purchased business. Imation also expects to invest approximately $15 million in additional working capital after the acquisition closes.
"This is an important acquisition for Imation as we implement our strategy to become a brand and product management company," said Frank Russomanno, president and chief executive officer, Imation Corp. "Bringing the assets of Memcorp into Imation builds on our recent successful acquisition of the Memorex brand and enables us to extend the Memorex brand further into select consumer electronics and accessories."
The acquisition broadens Imation's product portfolio to include Memorex- branded TVs and digital displays, including flat-panel LCDs and digital picture frames, iPod(TM) accessories, radios, and MP3 players. The portfolio also includes home theater video and portable DVD players, karaoke systems, and office products such as voice recorders and paper shredders. The acquisition also includes all existing brand licensing agreements, including Memcorp's recent agreement with MTV Networks, a division of Viacom International, to design and distribute specialty consumer electronics items under certain Nickelodeon properties and brands.
Ronald Zinke, vice president of Imation's Consumer Division for the Americas, will provide leadership for the Memcorp organization which includes sourcing, marketing, and distribution operations. Approximately 60 Memcorp employees from its U.S. and Hong Kong operations are expected to transfer to Imation.
Imation expects the transaction to be financially accretive, adding $0.09 to $0.12 in E.P.S., contributing $10 million to $12 million in operating income, and adding approximately $200 million in annual revenue in the first full year of operation.
About Imation
Imation Corp. is the only company in the world focused on the development, manufacture, and supply of removable data storage products spanning the four pillars of magnetic, optical, flash, and removable hard disk storage. With more than 50 years of data storage leadership beginning with the development of the world's first computer tape, Imation proudly marked its tenth anniversary as an independent company in 2006. In addition to the Imation brand, Imation Corp.'s global brand portfolio includes the Memorex brand, one of the most widely recognized names in the consumer electronics industry, famous for the slogan, "Is it live or is it Memorex?" Additional information about Imation is available at www.imation.com/ or by calling 1-888-466-3456.
FCMN Contact: bdallen@imation.com
Source: Imation Corp.
CONTACT: Brad Allen of Imation Corp., +1-651-704-5818, bdallen@imation.com
Web site: www.imation.com/
