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Cinram Sold to Investment Firm

25 Jun, 2012 By: Chris Tribbey

Replicator Cinram has reached an agreement to sell its worldwide assets and businesses to privately held investment firm Najafi Cos., owner of Direct Brands, SkyMall, Trend Homes and other brands.

The court-supervised transaction is expected to close in August, and the move is not expected to affect Cinram's day-to-day operations. Financial terms of the deal were not disclosed. Proceeds of the sale will be used to repay Cinram's senior creditors.

“Cinram is a market leader in its industries with a long track record of best in class performance,” said Jahm Najafi, CEO of Najafi Cos. “We look forward to a seamless transition for our customers, and to build on Cinram's significant base of strengths and expertise.”

Najafi made headlines in mid-2011 when its bid to acquire Borders Group was rejected.

“We look forward to joining with Najafi Companies,” said Cinram CEO Steve Brown. “Cinram will continue its focus on strengthening its competitive position in the market with a much stronger financial footing.”

Financial advisor Moelis & Co. has been working with Cinram for nearly a year, and the replicator had been actively looking for a buyer since at least March.

Cinram, which supplies and distributes discs for 20th Century Fox Home Entertainment, Relativity Media and others, May 11 posted a net loss of $25.5 million for the first quarter of 2012, and later that month announced that Cinram Optical Discs SAS, a French subsidiary of the Toronto-based replicator, would file for insolvency.

Cinram's shares will no longer be traded on the Toronto Stock Exchange starting July 16, after the company failed to meet the exchange's listing requirements.

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