Toronto, Canada’s Cookie Jar Entertainment has offered up US$195 million to acquire American Greetings’ Strawberry Shortcake, Care Bears and Sushi Pack properties outright. The move has effectively stopped the court action launched by American Greetings on June 20 that sought to block DIC Entertainment’s sale to Cookie Jar. At the same time, DIC shareholders have voted to accept Cookie Jar’s offer of US$31 million in cash and assumption of US$42 million in debt, finalizing the merger worth US$87.6 million.
Combined, Strawberry Shortcake and Care Bears have generated more than US$5 billion at retail worldwide since their 2002 relaunch, and licensing revenues from Strawberry Shortcake (estimated at approximately US$28 million for fiscal ’08) account for roughly 35% of DIC’s revenue. Subject to customary closing conditions, including financing, the properties should be sitting under the Cookie Jar umbrella by September 30, 2008. For his part, Cookie Jar CEO Michael Hirsh said, ‘It’s hard to acquire characters with this kind of history.’
American Greetings Properties president and CEO Josef Mandelbaum said his company wasn’t initially looking to sell the properties, but faced with pursuing possibly lengthy litigation, Hirsh’s offer to purchase Strawberry Shortcake and Care Bears became worth pursuing. He said conversations progressed quickly, and in the end the offer was a good opportunity to create value for American Greetings shareholders. In addition, AG will continue to be involved with the three properties for the foreseeable future. With the cash offer, AG also secured an exclusive 10-year licensing deal to produce social expressions products based on the properties.
Mandelbaum also confirmed that the AGP division will remain intact after the sale is finalized. Moving forward, AGP will concentrate on creating new IP and related entertainment. ‘We’re fundamentally a creative content company,’ he said. ‘This is a hit-driven business and the key is to create new properties all the time.’ To that end AGP is concentrating on getting programs for Twisted Whiskers and Maryouku Yummy off the ground. Mandelbaum added that the division will continue to put new properties into its licensing and entertainment development pipeline.
As for Strawberry Shortcake and Care Bears, the recent reassignment of master toy rights to Hasbro stays put and both Hirsh and Mandelbaum confirmed that American Greetings’ planned revamp of Strawberry, complete with a new look and a new TV series in 2009, is also going ahead as scheduled.
The twin moves catapult Cookie Jar into the top ranks of the kids business. Hirsh says the company is getting to work on assessing staffing and resource needs as it folds DIC into the corporate structure. And between DIC and its wholly owned European licensing agency CPLG, Hirsh feels the company is in good shape to handle the increase in business that bringing Strawberry, Care Bears and Sushi Pack into the fold will generate. While it will be integrated into Cookie Jar, DIC will continue to operate under its brand name and Hirsh confirmed that DIC founder Andy Heyward will be part of the upper management team.