Sonic Solutions has announced today that it will acquire digital media company DivX, merging the operations of the company into its own.
Under the terms of the agreement, Sonic will pay about $326 million in cash and stock, with DivX stock holders receiving 0.514 shares of Sonic and $3.75 cash per share. DivX closed the day trading at $8.79, after closing at $6.95 on Tuesday.
Sonic says the deal should close in September, and says the deal will possibly double its EPS (earnings per share) for the fiscal year that starts in April 2011.
For over 20 years, Sonic has provided the software used to press and distribute most DVDs, but the company recently began an expensive endeavor into downloadable content, teaming up with Best Buy for the CinemaNow online movie service.
With DivX, the company should be able to expand its market, as DivX tech is already embedded in over 300 million devices worldwide, ranging from smartphones to Blu-ray players and HDTVs.
“Our studio, storefront, and consumer electronics partners agree: they want a clear and efficient path to deliver premium content to their customers,” says Dave Habiger, president and CEO of Sonic Solutions. “The combination of Sonic and DivX promises to be the foremost provider of platforms, tools, and technologies for the efficient delivery of premium video entertainment to virtually any type of consumer electronics device. We expect DivX’s deep technology and broad deployment in the CE and mobile areas to give us significant leverage as we expand and enhance our RoxioNow premium entertainment platform.”
Result for: downloadable content
Harmonix has released the demo for the upcoming Rock Band sequel, Green Day: Rock Band and included is a teaser image that seems to imply that the upcoming game will have keyboard support, an all-new instrument for the popular music game series.
Users can download the two-track demo from the XBL Marketplace and play the songs “Boulevard of Broken Dreams” and “Welcome to Paradise.”
The image shows off the four standard icons, (mic, guitar, bass, drums) with the keyboard fifth.
The original game of the series sold over 5 million tracks, and led to a revolution in DLC (downloadable content), selling over 40 million tracks.
Rock Band 2 continued strong sales for the franchise, although reviews were not as great.
Pic via JoyStiq:
Result for: downloadable content
The Xbox Live-exclusive downloadable content (DLC) title “The Lost and Damned” has reportedly been downloaded over one million times from the online service. At around $20 a pop, it’s very decent revenue for a single DLC title.
However, it’s worth remembering that Microsoft paid Rockstar $50 million to produce two new chapters for the blockbuster “Grand Theft Auto 4″, released in April 2008.
The Lost and Damned broke day one sales records on Xbox Live, and according to analyst Michael Pachter, it will have been downloaded 2 million times from Xbox Live by the end of the year.
