Corel Corporation
announced the completion of its acquisition of InterVideo, Inc., a
leading provider of digital media authoring and playback software with a focus
on high-definition video and DVD technologies. Corel purchased InterVideo for
$13.00 per share of InterVideo common stock resulting in an aggregate
acquisition price of $198.6 million in an all-cash transaction.
The acquisition substantially expands Corel’s presence in the digital
media software market by creating the industry’s broadest portfolio of digital
imaging and DVD video products. With the addition of InterVideo, Corel will
deliver easier-to-use, multi-purpose high-definition video, imaging, and DVD
creation products to consumers and enterprises worldwide while extending its
presence in fast-growing Asian markets, such as China, Taiwan and Japan.
InterVideo’s comprehensive suite of advanced digital video and multimedia
software products allow users to record, edit, author, distribute and play
digital multimedia content on PCs and other devices. In 2005, InterVideo
acquired a majority interest in Ulead, a leading developer of video imaging
and DVD authoring software for desktop, server, mobile and Internet platforms,
and the acquisition of the remaining interest in Ulead is expected to be
completed before the end of 2006.
The acquisition combines Corel’s key strengths – business model
innovation, understanding of end user requirements and established
distribution in the Americas and Europe – with InterVideo’s core assets, which
include video technology innovation, established partnerships with the world’s
leading PC OEM partners and strong market presence in the Asia Pacific region.
“This strategic combination further strengthens Corel’s leadership
position in digital media software and will enable us to deliver even greater
value to our customers, partners and shareholders worldwide,” said Corel Chief
Executive Officer David Dobson. “We welcome InterVideo’s employees, customers
and partners to Corel and we look forward to working with them.”
The combination of Corel, InterVideo and Ulead product lines form the
industry’s broadest portfolio of digital media software ranging from photo
sharing and image editing products to advanced digital imaging, video editing,
and high-definition DVD creation and playback software. Customers and partners
now have access to a full breadth of popular, award-winning digital media
brands including WinDVD, WinDVD Creator, Ulead PhotoImpact, Uleadv VideoStudio, Ulead DVD MovieFactory, Corel Paint Shop Pro
Photo and Corel Snapfire – all from a single trusted source. In
addition, Corel will deliver HD DVD and Blu-ray Disc solutions to the market,
just as the worldwide demand for high-definition video gains significant
momentum.
The InterVideo and Ulead product lines complement Corel’s existing
digital imaging and video products in several areas, including performance,
ease of use and price. In addition, the companies share a common vision around
delivering high quality, full-featured software to consumers through leading
OEMs, retailers, and Internet distribution channels.
“The addition of InterVideo and Ulead products to our existing digital
imaging portfolio puts Corel in a unique position to meet the evolving needs
of consumers demanding higher quality and more accessible digital media
content – specifically high-definition digital images and videos accompanied
by more creative and enjoyable ways to view and share them,” said Blaine
Mathieu, general manager of Corel’s Digital Imaging Business. “With the
ongoing convergence of different media and devices, consumers need
easier-to-use tools that can handle all media types – video, photo and audio –
on an equal basis. Corel will fulfill this growing demand by delivering new,
easier-to-use, multi-purpose video and imaging software products to consumers
and enterprises worldwide.”
Corel will leverage its complementary geographic strengths with
InterVideo and Ulead to create an even more efficient sales, marketing and
product development engine. With significant development offices in
California, China, Minnesota, Ottawa and Taiwan, Corel will be better
positioned to meet the specific requirements of customers and partners in
various locations around the world.
“The excitement surrounding properties like YouTube clearly showcases why
the multimedia software and services segment is so incredibly hot right now,”
said Rob Enderle, Principal Analyst for the Enderle Group, a leading San Jose,
CA-based research firm covering emerging hardware and software markets. “The
enormous mass market potential for products that provide solutions for this
rapidly growing segment simply has not yet been realized. Corel is placing
itself in the middle of this huge opportunity so that they can capitalize on
this incredible opportunity and help drive market growth.”
InterVideo and Ulead customers and partners can continue to access
support through their existing contacts and channels. Further information can
be found at www.intervideo.com, www.ulead.com or www.corel.com.
The acquisition was financed through a combination of Corel’s cash
reserves, InterVideo’s cash reserves and debt financing which included Corel
entering into an amendment to its existing credit agreement to increase its
available term borrowings by $70 million.
Corel will provide guidance on the combined company when it reports its
financial results for the year ended November 30, 2006, in January
