Thomson Multimedia to Acquire Carlton's Technicolor Unit

Thomson Multimedia, the world's fourth-largest consumer electronics maker, will buy Carlton Communications' Technicolor unit in Camarillo for $2.1 billion in cash and shares to develop digital delivery of movies.

Paris-based Thomson Multimedia, which makes RCA televisions, also specializes in helping television networks switch from analog to digital delivery. Technicolor, the company that first brought color to movies in the 1920s, is developing systems that would allow movies to be delivered by satellite to theaters and stored on computer discs rather than the reels of film used today.

"Thomson Multimedia wants to use Technicolor to develop its digital technology, something that Carlton was unable to do," said Nicolas Martin, an analyst at Aurel-Leven in Paris. "Thomson gains an industrial partner as well as a business that makes money."

Thomson Multimedia will pay $1.35 billion in cash and 15.5 million new shares for Technicolor, the company said. Carlton will own about 5.5% of Thomson.

Technicolor, founded in 1915, is the biggest maker of digital video discs and the largest processor of motion picture films. It had revenue of $1.6 billion and operating profit of $249 million in its fiscal year ending Sept. 30. It employs 1,400 people.

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