|Acquisition Serves as Platform for Future Technicolor Expansion in Asia|
Thomson (Euronext Paris: 18453) (NYSE:TMS), a worldwide leader in video and film technologies, products and services, today announced the acquisition of Cinecolor Lab Company, Ltd., a Thai company and one of the premiere motion picture film laboratories and post-production facilities in the Austral-Asian film and postproduction markets. The acquisition furthers Thomson's strategic goal of expanding the service and geographic opportunities offered by its Content and Network division to the filmmaking community worldwide. Financial terms were not disclosed.
"We are committed to serving the needs of our growing customer base," stated Thomson Digital Media Solutions (DMS) Senior Executive Vice President, Lanny Raimondo. "The Austral-Asian market will continue to expand over the next decade and we will respond to those opportunities by providing Technicolor's world renown services. Our customers have made it very clear to us that they want a vibrant Technicolor post-production and release print presence in this vital region of the world. We are happy to help respond to this request by welcoming the strong and well-respected Cinecolor team to the Thomson family."
Thomson's strategic objectives for its Content and Network division, as announced at the beginning of the year, are to expand its client base by broadening its service offering and increasing its geographical coverage globally. Establishing a platform for future growth in the Austral-Asian market is a critical step towards this strategic goal.
The Austral-Asian market is expected to be a prime area of growth in laboratory and post-production services over the next decade. According to the MPAA (Motion Picture Association of America), 40% of the international theatrical market comes from the Asian-Pacific region of the world, which amounted to approx. US $3.86 billion in 2002, while the total international box office amounted to US $9.64 billion. From 2001 to 2002, the International box-office grew by approximately US $1.5 billion.
In 2002, total output from the Asian market reached 532.9 million feet of film processed, from the top seven producing countries: Thailand, Japan, South Korea, Hong Kong, The Philippines, Malaysia, and Taiwan. In Thailand alone, production accounted for 42% of this work, followed by Japanese production at 28%. Technicolor expects screen counts in this region to grow by double-digit annual rates for the rest of this decade.
Thomson and Technicolor are well-positioned to benefit from this market growth. Thomson already manufactures and distributes DVD's in Australia following its acquisition of Southern Star Duplitek in 2002. The acquisition of Cinecolor now sets the stage for the development of a wider range of high-quality services based out of low-cost manufacturing locales.
In addition, Thailand has recently emerged as a central provider of film print services for the Asian theatrical feature market -- including both independent features and theatrical features from major Hollywood studios. Cinecolor currently provides services to many of Hollywood's most prominent feature studios including Disney and New Line International.
"Cinecolor is one of the largest and best established film and post-production service providers in Southeast Asia," continued Mr. Raimondo. "They have a very strong management team, with exceptional engineers, and highly-skilled personnel -- all of whom will be transitioning with the company. Cinecolor also has a great reputation with customers and they are an excellent fit within our overall long-term plans."
Cinecolor Lab Co. Ltd. was established in 1977 as Thailand's first film laboratory. Today, it has grown to become a market leader in both film processing and sound services. Its best of class capabilities include front-end processing and release printing; digital video post-production and sound mixing; regional subtitling; video to film transfer; and digital optical sound transfer. The facility employs approximately 200 highly skilled employees and operates in an 80,000 square foot facility.
"We are very happy to become a part of the Thomson/Technicolor family," said Managing Director of Cinecolor, Les McKenzie. "The addition of Technicolor's capabilities to those already present at Cinecolor creates the best overall service team in Austral-Asia. We are very excited about what this means for our customers both in Thailand and throughout the region."
Certain statements in this press release, including any discussion of management expectations for future periods, constitute "forward-looking statements" within the meaning of the "safe harbor" of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on management's current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements due to changes in global economic and business conditions, consumer electronics markets, and regulatory factors. More detailed information on the potential factors that could affect the financial results of Thomson is contained in Thomson's filings with the U.S. Securities and Exchange Commission.