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Madman Acquired by Funtastic for $34.5 Million AUD

posted on 2006-05-10 14:57 EDT
Leading Australian Anime Distributor Purchased by Leading Australian Toy Distributor

Funtastic Limited has announced the purchase of the Madman Group of companies in Australia for $34.5 million AUD (US$26.5 million). The deal gives the founders and joint managing directors of Madman (Tim Anderson and Paul Wiegard) $26.4 million in cash upfront and $2.7 million AUD in scrip to be held in escrow for 18 months. The remaining $5.4 million AUD is being held in four performance based deferred payments. The purchase of Madman was effective May 1, 2006. Tim Anderson stated that there will be no change in company operations.

Funtastic has rationalised the deal as a way for them to obtain DVD rights for properties they already hold the toy rights for. Stating that in the past, DVD rights have been passed onto other companies due to their lack of experience in the field, with the other companies frequently benefiting from their Funtastics marketing initiatives. With Madman holding 87%2 market share in anime within Australia, and a estimated 2.5% of the Australian DVD Market overall, they are considered to be the market leaders within the field, possibly enticing companies to allow Funtastic to purchase the rights to shows they would normally be denied. Also by combining Madman's DVD knowledge with Funtastic's toy marketing skills, they believe that Madman will be able to further explore merchandising opportunities within the anime market.

The first announced range to come out of the acquisition will be a children's range, labelled "Mad 4 Kids".

There has also been some concern voiced through the official Madman forums as to whether the acquisition would influence Madman's future releases, based on Funtastic's family marketing focus, leading to the eventual dropping of mature titles such as Gantz and Elfen Lied.

Tim Anderson informed concerned customers that although Madman will be pursuing properties focused towards the children's market, with a new label "Mad 4 Kids", that there is no intention of changing policy concerning new acquisitions anytime soon, and that Funtastic has given full support in Madman's current operations. Tim Anderson and Paul Wiegard have signed four year employment deals with Funtastic Limited and will be sitting on the companies' board.

Founded in 1996 as an anime distribution company, Madman is now Australia's leading distributor of anime and manga and has expanded to also distribute Asian cinema, Bollywood cinema, independent cinema and other niche categories. The company employs 130 people and expects annual sales of $35.1 million AUD in the fiscal year ending June 30, 2006 with EBITA profits of $6 million AUD (net profits are not listed). The company was privately owned.

Established in 1994, Funtastic Limited is Australia's largest distributor of children's products. Licensed brands include Barbie, Spider-man, Zoids, Crush Gear, Winnie the Pooh, Lord of the Rings and Teenage Mutant Ninja Turtles. The company is publicly traded on the Australian Stock Exchange under the symbol FUN.

Please note:
1: Funtastic Limited is in no way, shape or form affiliated with or part of FUNimation Entertainment.
2: According to Madman's website the company has 87% share of the Australian anime DVD market. According to information presented on Funtastic's website, Madman has 97% share of the Australian anime DVD market, 8% share of children's animated DVDs and approximately 2.5% of the overall DVD distribution market.




Updated

Madman has informed us that the latest GFK figures for the Australian DVD market inidcate that Madman has a 97% share of the Australian anime DVD market. Their website is out of date and will be updated to reflect the current statistics at a later time.

Additionally, where we stated, "Tim Anderson and Paul Wiegard have signed four year employment deals with Funtastic Limited and will be sitting on the companies' board," this was incorrect. Anderson and Wiegard will sit on Madman's board of directors, but not Funtastic's board of directors. ANN apologises for this error.

This article has a follow-up: Madman Corrections (2006-05-11 16:11)

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