Rumors from earlier in the year come to fruition as Iconix Brands sells its entertainment segment.
DHX Media has signed a definitive agreement to acquire the entertainment division of Iconix Brand Group, including an 80 percent controlling interest in the Peanuts brand and 100 percent of the Strawberry Shortcake brand, for $345 million.
The remaining 20 percent interest in Peanuts will continue to be held by members of the family of the brand’s creator Charles M. Schulz.
The transaction is expected to close on or around June 30, 2017.
The addition of Peanuts to DHX’s global brand portfolio will lead to an increase in the scale and breadth of the company's consumer products business from 19 percent to an estimated 44 percent of total annual revenue, on a pro forma basis.
Both Iconix and DHX Media are among the top licensors in the world according to License Global’s annual Top 150 Global Licensors report. Iconix is the fourth largest licensor in the world, reporting $12 billion in retail sales of licensed merchandise in 2016. While DHX Brands is the No. 60 licensor in the world with $700 million in retail sales of licensed merchandise in 2016.
“Peanuts is one of the world’s greatest entertainment brands, with a tremendous global legacy of comics, animated content and consumer products reaching back almost 70 years,” says Dana Landry, chief executive officer, DHX Media. “We are thrilled by the opportunity to welcome Charlie Brown, Snoopy, Lucy, Linus and the entire Peanuts gang into our family of leading kids’ properties, including ‘Teletubbies,’ ‘Inspector Gadget,’ ‘Caillou,’ ‘Degrassi’ and others.”
Reports of Iconix’s intent to sell the Peanuts and Strawberry Shortcake brands first surfaced in early February, but were never confirmed.
Iconix acquired the Peanuts brand in April 2010 for $175 million from United Features Syndicate and E.W. Scripps (along with other assets of what was then called United Media Licensing), and Strawberry Shortcake in February 2015 from American Greetings for $105 million.
As a result of the acquisition, DHX Media revenue will grow 52 pecent to approximately $443 million (Canadian), on a pro forma basis.
The deal will add 340-plus half-hours of proprietary content to DHX Media’s library, which the company will also use to feed potential new productions, including new digital content for YouTube, mobile and video-on-demand services. DHX also plans to mine what it calls “an underexploited library” for global distribution and expansion into new territories and channels, including its WildBrain network on YouTube.
DHX reports that a new "Strawberry Shortcake" series is currently in development. The brand already boasts 148 half-hours of content distributed in more than 120 countries and a comic book series that was launched in May 2016. The brand has 305-plus licensees in 90 countries across the world bringing in $4 billion at retail globally since its launch.
The Peanuts brand is the eighth largest character brand at retail in the world, according to DHX, and has 14 million fans on social media. With 195 half-hours of content including 42 Peanuts specials, the brand is well-positioned in the family entertainment marketplace. Peanuts has more than 1,100 licensees in 100 territories worldwide and brought in $1.3 billion at retail in 2015 alone.
“Over the past 10 years, DHX Media has become a global leader in children’s entertainment content, building scale across production, distribution and consumer products and is perfectly positioned to benefit from the incredible growth of streaming services, worldwide,” Landry added. “Peanuts and Strawberry Shortcake have widespread, evergreen appeal that make them ideal for layering onto this platform, complementing our 450-title library, and significantly increasing our scale in consumer products. These brands are expected to drive meaningful growth across multiple revenue streams, and we look forward to extending their reach to new generations of kids worldwide.”