Acquisition of Music Box Leisure Strengthens Entertainment Business
Air Music (AIM: AMU), a leading UK producer, manufacturer and wholesale distributor of low priced entertainment
products to the international market, announces that the acquisition of Redworth Limited, which is more commonly known
by its trading name, Music Box Leisure ("MBL"), for a maximum consideration of £37.15 million, was approved at its AGM
yesterday. The acquisition, which constitutes a reverse takeover under the AIM Rules, considerably strengthens Air Music's
position at the forefront of the low-priced entertainment sector in the UK.
Music Box Leisure
MBL, an existing customer of Air Music, is one of the UK's leading independent distributors of CDs, videos, DVDs and video
games. It supplies a range of retailers and supermarkets, including Morrisons, Co-op and Safeway, as well as motorway
service stations and ferries.
MBL specialises in providing a mixed range of audio, visual, gaming and multi-media titles to retailers for whom this type
of product is not their main sales offering. It sources products from major audio and visual companies including Sony,
Warner Brothers, Disney and Universal and creates multi-buy ranges of products, which are tailored to the retailers
requirements and do not follow exclusively either the chart or budget route.
Benefits of the acquisition
Based on last year's results, the financial implications of the acquisition for the Company will be significant. In the year to
31st March 2004, MBL, which has achieved all its growth organically, made a profit after tax of £2.38 million on a turnover
of £37.1 million. Further growth in revenues is anticipated for the current year and the Directors believe that financial
benefits and synergies will be derived from the acquisition. Over the same period, Air Music reported a profit before tax,
interest and goodwill amortisation of £1.91 million, on a turnover of £15.76 million.
Air Music believes that the combination of the two businesses will af