Imation today announced that it has entered into a definitive agreement to acquire certain assets of Memcorp Inc. and Memcorp Asia Limited (together known as "Memcorp") from privately held Hopper Radio of Florida, Inc.
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.
Memcorp, a U.S.-based consumer electronics marketing and distribution company, 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. Memcorp sells a range of video, audio and home electronics products through retailers in North America. Memcorp has been operating under a long-term license agreement for the Memorex brand. Imation will acquire all Memcorp sourcing, marketing and distribution operations, as well as Memcorp's recent three-year agreement with MTV Networks, a division of Viacom International, to design and distribute specialty consumer electronics items under certain of the Nickelodeon brands.
The acquisition is expected to 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.
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.