DHX Media to cut its debt load with money from Sony-Peanuts deal: CEO

HALIFAX — DHX Media Ltd. says the sale of nearly half of its stake in the Peanuts entertainment business to a Sony Corp. division for $237 million cash will help reduce the Canadian animation company’s debt load and improve its operating results.

The Halifax-based company will retain 41 per cent of the Peanuts business based on characters such as Snoopy, Charlie Brown and Lucy Van Pelt, while the family of creator Charles M. Schulz will continue to own 20 per cent and Sony Music Entertainment (Japan) Inc. will own 39 per cent.

Sony announced the deal on Sunday and DHX Media confirmed it early Monday as it announced financial results that included a loss of $8 million in the three months ended March 31 and $116.5 million of revenue.

That compared with a year-earlier profit of $7.6 million and $78.3 million of revenue prior to the Peanuts acquisition.

DHX bought majority ownership of the Peanuts and Strawberry Shortcake brands last year under a US$345-million deal that significantly increased its revenue but also its debt load.

DHX Media executive chairman Michael Donovan said the transaction will reduce its debt load “as we team up with an ideal partner to help us reach our worldwide growth targets for Peanuts in the coming years.”

Companies in this story: (TSX:DHX.A, TSX:DHX.B)