JAKKS Pacific Inc. Announces Proposed Acquisition of Flying Colors Division|
MALIBU, Calif.--(BUSINESS WIRE)--Sept. 23, 1999--JAKKS Pacific Inc. (NASDAQ/NM:JAKK - news) today announced that it has signed a definitive agreement to acquire the Flying Colors business of privately held, Michigan-based Colorbok Paper Products Inc.
Flying Colors, which achieved sales of approximately $54 million in its fiscal year ended May 31, 1999, is a leading brand in the activity segment of the toy industry. Products include molded plastic activity sets, clay compound playsets and lunch boxes. Licensed characters used in conjunction with is products include Nickelodeon's Rugrats and Blue's Clues, Warner Bros.' Looney Tunes, Mattel's Barbie and Sanrio's Hello Kitty.
JAKKS Pacific plans to retain two senior divisional executives in sales, product development and licensing, and the product design and launch team. But, to achieve greater operational and cost efficiency, JAKKS expects to transfer certain of the Flying Colors operations to JAKKS Pacific's U.S. and Hong Kong offices.
JAKKS believes that its strength in manufacturing, sales, marketing and distribution will enable it to take advantage of Flying Colors' quality products and licenses to enhance the product line. In addition, Flying Colors' extensive distribution among specialty chains may provide an opportunity to expand the distribution of JAKKS Pacific's other product lines through these channels.
Commented Jack Friedman, chairman and chief executive officer of JAKKS Pacific: ''Flying Colors represents our largest acquisition to date, and will immediately give us a significant presence in a core sector of the expanding toy arts and crafts business. The acquisition also continues our strategy of diversifying and expanding our product lines and distribution channels.
''JAKKS Pacific has expanded its product offering from dolls and action figures to include die-cast vehicles and collectibles, then to include infant and preschool toys, and now to include toy arts and crafts activity sets.
''Given Flying Colors' rapid growth, creativity, key licenses and strong management, we see it as a natural fit with JAKKS Pacific. And, we are pleased to have two very talented Flying Colors' executives and their team join the JAKKS Pacific organization,'' added Friedman,
Commented Stephen Berman, president and chief operating officer of JAKKS Pacific: ''We are very excited about the addition of Flying Colors. Consistent with our previous acquisitions, we believe that we will be able to realize various efficiencies through the synergy created by this acquisition.
''Yet, even without these efficiencies and anticipated operational cost-saving, we expect this acquisition to be accretive to earnings immediately. Closing is expected to be within 30 days.''
Shareholders of Colorbok will retain the Colorbok specialty business, which manufactures and distributes gifts, stationery, scrapbooking and children's products to specialty retailers under the Colorbok Paper Products name.
JAKKS Pacific Inc. and its affiliates develop, manufacture and market toys and related products for children, including action figures featuring characters from the World Wrestling Federation, die-cast collectible and toy vehicles under the Road Champs and Remco brand names, Child Guidance® preschool toys, foam puzzle mats and playsets, and a line of fashion dolls and accessories.
''Safe Harbor'' Statement under the Private Securities Litigation Reform Act of 1995: This news release contains forward-looking statements. Such statements reflect the current views of the company with respect to future events and are subject to certain risks, uncertainties and assumptions. Although the company believes that the expectations reflected in such forward-looking statements are reasonable, should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual future results or events may vary materially from those described herein.
JAKKS Pacific Inc., Malibu
Stephen Berman, 310/456-7799
Silverman Heller Associates, Los Angeles
Ruth Shaer/Eugene Heller, 310/208-2550