Fueled by $30 million in funds that the company raised in a public offering in the United Kingdom late last year, Burbank-based DIC Entertainment is on the prowl for acquisitions as it attempts to shift the focus of the firm from being a merely a children’s entertainment provider to becoming a diversified multimedia company with footprints in emerging forms of media, games, publishing and mobile content. While Andy Heyward, the company’s CEO, would not divulge which companies his firm was currently targeting, he has said in the past that DIC is evaluating the launch of a 24-hour digital kids channel in the U.S. and that it has been in talks to acquire a home video distribution company. He said that one of the reasons his firm decided to list on the Alternative Investment Market unit of the London Stock Exchange was to have European cash on hand to purchase European firms. “We wanted European currency to acquire European companies,” Heyward said. “The IPO went very well. It was oversubscribed and we have a very broad investor base from a large number of institutions. I’d say it’s been very well received. We’re currently using the cash to target content and distribution companies. We’re currently in negotiations and we will be making acquisition announcements shortly.” Heyward also said that one of the major reasons why DIC is targeting Europe is his belief that the European marketplace is currently more fertile for acquisitions than its American counterpart. “The growth opportunities in the European marketplace are great, they just aren’t as picked over as they are here,” Heyward said. “We’re still going to be focused on providing family and children’s entertainment, but the next step of our company is to provide overall brand management. Anything we acquire will have to be able to be used across our whole chain of entertainment options.” However, the IPO was only one major component of a flurry of activity for the company, as DIC inked deals with a variety of different firms over the past year. Among them the “DIC Kid’s Network,” the world’s first animation channel for cell phones. In this pact with SmartVideo Technologies Inc., DIC allowed for its vault of original children’s content including programs like “Madeline,” “Inspector Gadget,” and “Strawberry Shortcake,” to be available for viewing on cell phones and wireless devices. Another property that DIC has reaped the dividends from, has been a cartoon called “Trollz.” Heyward singled the property’s website www.trollz.com as one of DIC’s major footprints in the Internet space, an area the company is eager to capitalize on. According to Heyward, the site has 1.5 million registered users, the brunt of them, females aged 8-12. Additionally, last summer DIC sold the international rights for the Trollz cartoon series to Nickelodeon International. Currently, the program airs in 69 countries worldwide. Another major agreement that Heyward singled out as instrumental in the company’s future strategy is another deal made last summer with the McDonald’s Corp., where McDonald’s named DIC its worldwide licensing agent for active play toys entertainment and apparel. This deal concerns McDonalds’ McKids brand, which seeks to promote “balanced and active” lifestyles through active play, active learning and active entertainment.” Accordingly, the McKids line includes bikes, skateboards, scooters, outdoor play equipment, videos and an entire line of clothing and accessories. Additionally, McDonald’s and DIC are in the midst of introducing a brand new line of vintage McDonald’s apparel to be introduced at specialty shops nationwide. But these deals are just merely a few of the things that DIC has in the works. Currently, DIC is rolling out a series of collectible DVDs based on classic series from the company’s vault of programming. Partnering with Los Angeles-based Shout! Factory, DIC is currently releasing many of its shows on DVD for the first time, including “Heathcliff,” “Inspector Gadget,” and the “Super Mario Bros. Super Show.” Lorrie Shapiro, the senior director of DVD and Home Video for Shout! Factory said the partnership between her firm and DIC is going well. “They’ve been unbelievable in digging up old art cells and sketches in order to make the DVDs that we release of the utmost quality,” Shapiro said. “Andy Heyward has made himself available to be interviewed for DVD extras and in general they’ve been great to work with. It’s a great partnership on the production end and they’re keenly interested in maintaining excellent relationships.” And just this month, DIC signed one of its biggest deals yet, a partnership with CBS to launch an all-new Saturday morning branded kids programming block, entitled “CBS’s Secret Saturday Morning Slumber Party,” starting in the fall of this year. As part of the multi-year deal, the show will feature three hours of children’s programming each week and serve as a platform to introduce new kids programs created by DIC. In addition, it will feature series from DIC’s library of programming. “DIC is a leader in children’s entertainment with a deep library of kids’ programming and a successful track record for launching and running an E/I block in the U.S.” Nancy Tellem, president, CBS Paramount Network Television, said in a prepared statement (Tellem was unavailable for an interview). “Their numerous Emmy, Humanitas and other awards speak to their attention to quality and their impressive educational advisory board speaks to their commitment to providing children with the highest educational and entertainment values in their programming.” Another factor that has contributed to the demand for DIC’s products is the fact that the world of television animation has stayed primarily traditionally animated in contrast to the motion picture world that has become more computer generated. “In television, the hand-drawn stuff continues to remain very viable,” Steve Hulett, the business representative for the local 839 animation guild, said. “CGI animation hasn’t been met with better or bigger ratings in the television world, and since DIC does hand-drawn animation they haven’t had to deal with the increased costs of switching to CGI.”
