twice connect
careers

Imation Deals For Memcorp

5/07/2007 03:41:00 PM Eastern

Oakdale, Minn. — Imation has agreed to the acquisition of the consumer electronics marketing and distribution businesses of Memcorp, the accessories company that distributes Memorex brand blank media and specialty CE items, from privately held Hopper Radio of Florida.

The purchase price is approximately $60 million in cash and notes.

Imation, who bought the Memorex brand last January, adds Memcorp’s sourcing, marketing and distribution operations. It also assumes Memcorp’s recent three-year agreement with MTV Networks, a division of Viacom International, to design and distribute specialty consumer electronics items under the Nickelodeon family of brands.

Imation completed a deal for TDK’s blank media business last month.

Memcorp has been operating under a long-term license agreement for the Memorex brand and had Memorex-branded sales in 2006 of approximately $190 million out of total sales of approximately $285 million, including other branded sales that are not a part of the transaction.

The acquisition will expand Imation’s Memorex-branded presence at retail, broadening Imation’s product portfolio to include Memorex-branded TVs and digital displays, including flat-panel LCDs and digital picture frames, iPod accessories, radios and MP3 players. The portfolio will also include digital cameras, home theater video and portable DVD players, karaoke systems and office products such as voice recorders and paper shredders.

The purchase price for the assets includes approximately $23 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. The transaction is expected to close in the third quarter of 2007, subject to customary closing conditions and governmental approvals.

The financially accretive transaction is expected to contribute approximately $200 million in revenue and an estimated $10 to $12 million in annual operating income to Imation’s business, according to a release.

“This acquisition builds on our recent successful acquisition and integration of the Memorex brand, and allows us to gain full control and leverage of the Memorex brand worldwide,” said Frank Russomanno, CEO/president of Imation. “Memcorp’s product portfolio, global sourcing expertise and creative marketing and licensing capabilities in branded consumer electronics, strengthen and extend the powerful Memorex brand across a variety of products beyond removable media.”

“Bringing our brand licensing expertise in consumer electronics to a recognized global leader carrying one of the broadest portfolios of data storage brands and products is an exciting opportunity,” said Barry Smith, founder, president and CEO of Memcorp. “I am confident the acquisition will further strengthen the Memorex brand and complement Imation’s total product portfolio while potentially extending the company’s popular consumer brands to additional geographies and product categories.”

Approximately 60 Memcorp employees from the company’s U.S. and Hong Kong operations are expected to transfer to Imation as part of the acquisition.

PHOTOS
Nationwide PrimeTime 2014

Scenes from Nationwide PrimeTime buy fair held in

ProSource Meeting Filled With Optimism

San Antonio — Optimism reigned at ProSource’s

Ingram Draws 500 To Spring Vendor Expo

Scottsdale, Ariz. — Ingram Micro Consumer

CEA Holds ’14 Digital Patriots Dinner

Washington — CEA held its annual Digital Patriots’

8 Technology Accessories For a Greener Earth

An Earth Day review of Earth-friendly products, by

BrandSource Shows Diverse Product Selection

BrandSource’s Summit show at the Marriott World