News Production I.G Announces Mag Garden Merger
posted on 2007-07-05 18:09 EDT
Production I.G. announced on July 4 that it will merge its management with that of Mag Garden's, and thus effectively acquire the smaller, less profitable company by December 1. The announcement cited the sluggish animation DVD market, the nonviable DVD-only business model, the decline in the sales numbers of comic magazines, and the shift of comics to online services for the changing business environment. Production I.G specializes in animated works that often draws upon comics for their original stories, such as the Ghost in the Shell movies and the Tsubasa film and video series. Mag Garden's manga such as Aria and Tactics have inspired various anime, games, and mobile content.
Production I.G noted that its Xebec subsidiary studio already produces several television series based on Mag Garden manga such as Elemental Gelade. Production I.G has 14 original works and 64 animated versions for which it retains the copyrights. For its part, Mag Garden has created 106 original manga works which have collectively sold 26 million volumes. Mag Garden has financed the animation for eight of the manga titles. In particular, the Aria series has sold 3 million manga volumes and 300,000 DVDs. ADV Manga once imported several titles from Mag Garden, but Mag Garden's titles have since been relicensed, notably to Tokyopop.
Production I.G made 5.4 billion yen (about $US44 million) in revenue, with 250 million yen (about US$2.5 million) in profit, for the period ending in May 2007. Mag Garden made 1.845 billion yen (about $US15.03 million) in revenue, but with a 100 million yen (about US$800,000) loss, for the period ending in March 2007. Production I.G has 181 employees, whereas Mag Garden has 32.
Production I.G operates under the I.G holding company. Production I.G currently owns 15% of Mag Garden and 100% of Xebec, while the Mag holding company owns the remainder of Mag Garden. The Mag and I.G holding companies will merge to form the tentatively named I.G Port, whose company will own 100% of Mag Garden, Production I.G, and Xebec as separate subsidiaries. A stock swap of one I.G share to a half Mag share will formalize the merger.