DreamWorks Animation, the Glendale-based studio behind the "Shrek" and "Madagascar" movies, is buying Classic Media, a company that owns the rights to "Casper the Friendly Ghost," "Lassie," "The Lone Ranger" and other iconic entertainment characters, for $155 million.
DreamWorks Animation announced the all-cash deal early Monday morning.
The deal marks the first acquisition for the studio since it went public in 2004.
The purchase will deepen DreamWorks Animation's library of film and television characters, giving the studio a new stream of licensing revenues and a potential boost to its share price. Although its movies have generally fared well at the box office, the company's stock has fallen nearly 40% in the last two years.
"Classic Media brings a large and diverse collection of characters and branded assets that is extremely complementary to DreamWorks Animation's franchise business, and we plan to leverage it across our motion picture, television, home entertainment, consumer products, digital theme park and live entertainment channels," DreamWorks Animation Chief Executive Jeffrey Katzenberg in a statement.
New York City-based Classic Media licenses many of its characters to studios, including the Walt Disney Co., which is making "The Lone Ranger," a big-budget live-action movie produced by Jerry Bruckheimer that will be released next year. DreamWorks also is making a movie based on the animated characters "Mr. Peabody and Sherman," due out Christmas 2013. Classic Media manages the characters in a joint venture with Jay Ward Productions.
DreamWorks was among at least six bidders for Classic Media, an $82-million-a-year company that owns more than 450 family titles, including "Frosty the Snowman," "George of the Jungle," "Rocky & Bullwinkle" and contemporary bestsellers such as "VeggieTales." Founded in 2000, the company is owned by Boomerang Media Holdings, part of the portfolio of private equity firm GTCR, which sources said had been eager to cash out its investment.
Classic Media Co-Chief Executives Eric Ellenbogen, a former CEO of Marvel Entertainment, and John Engelman will run the company, but now as a division of DreamWorks. The sale was first reported by the Wall Street Journal on Sunday night.