DIC Entertainment may have Inspector Gadget and Carmen Sandiego. But it wanted Frosty the Snowman, Rudolph the Red Nosed Reindeer and Dumbo.
"Our business is concentrated on the older kids, 6 to 11, and we never had to focus on the market for smaller kids 5 and below, so this will be a great opportunity to do that," said DIC Chief Executive Andy Heyward.
He was referring to Burbank-based DIC's $170 million purchase of Golden Books Family Entertainment Inc. and all the characters it markets to young children.
Now, Heyward said, the investor group he led in buying DIC from Walt Disney Co. seven months ago is poised to market such Golden Books characters as Poky Little Puppy, Pat the Bunny and Little Lulu.
"We felt that this was a golden opportunity for us to bring back some great children's characters," said Heyward of his company's June acquisition.
Heyward plans to bring many of Golden's famed literary characters to local toy store shelves with merchandising deals, books and brand new cartoons but only after they appear on some of DIC's television programs. "You can't have effective marketing without television," he said.
Heyward said some characters, like Poky Little Puppy, never have been on TV despite a wide following among parents of pre-schoolers. "Pat the Bunny is a character all young mothers know, and that's another opportunity for us," he said.
Independent children's media consultant Peggy Charren agreed with the strategy. "It makes sense to cater to young families and their smaller children with these wonderful characters," Charren said. "It brings DIC to a whole other market that is largely ignored."
Families with young children make up a niche market that has not been effectively exploited by many children's television producers, Charren said.
Heyward conceded that taking on a company that has struggled financially for years is a challenge, but it is also a "golden opportunity to really maximize and bring tremendous value to these timeless characters."
Golden last posted a profit in 1993. The purchase in 1996 by an investor group led by Richard E. Snyder, Simon & Schuster's chief executive, didn't seem to help. Snyder had plans to reinvigorate the company with a new printing plant and new talent, but to little avail. Last year, the publishing firm posted a $100.3 million loss on revenues of $149 million.
Under terms of the deal, privately held DIC will pay the Snyder group $70 million in cash plus a $7 million promissory note for Golden Books' assets. DIC will also take on $90 million of the company's debt.
Golden Books publishes 500,000 titles, including those featuring Lassie, The Lone Ranger, Abbott & Costello, Frosty the Snowman, Rudolph the Red Nosed Reindeer and Dumbo. The company also has produced cartoons and films like "Lassie," "Powerpuff Girls" and "The Autobiography of Miss Jane Pittman," among others. Heyward said the company's library and other properties would work well with DIC's already extensive holdings.
Meanwhile, Heyward said, DIC will continue to focus on its core business of children's television programs. Its break with Disney has allowed it to pursue avenues that had been previously closed to the company.
"Disney had this policy that we couldn't sell to competing networks, so we couldn't work with Fox or other companies and it hurt us," he said. "But we're freer to do things now that we're not with Disney."
DIC has already signed agreements to produce programs in the fall on ABC, Fox Broadcasting Co., the WB Network, Disney Channel, Nickelodeon and the Cartoon Network.
DIC is now scheduled to produce about 100 hours per year of programs like "Sabrina, the Animated Series," "Mummies Alive," "Inspector Gadget" and "Carmen Sandiego," up from 75 hours during the Disney days.
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