Official Press Release
Hasbro Awarded Five-Year Strategic License to Marvel's Library of Over 5,000 Characters Product Inspired by Spider-Man 3 Movie to be Among the First to Market.
PAWTUCKET, R.I. and NEW YORK, NY (Jan. 9, 2006) – Hasbro, Inc. (NYSE:HAS) and Marvel Entertainment, Inc. (NYSE:MVL), announced today a license under which Marvel has granted Hasbro toy and game rights to its renowned Super Hero universe that includes franchises such as Spider-Man, Fantastic Four, X-Men and Captain America. Through the agreement, Hasbro has obtained the rights to develop products based on Marvel's globally-known universe of over 5,000 characters in a wide range of toy and game categories -- including action figures, role play and preschool toys, board games and puzzles. The agreement covers both the "classic" comic book look of the characters as well as product lines inspired by Marvel-themed movies.
The five-year license gives Hasbro the rights to bring Marvel Entertainment-based toy products to retail beginning January 1, 2007. Hasbro's first full line of products based on Marvel properties is expected to center on Ghost Rider and the highly-anticipated movie event, Spider-Man 3, scheduled for release on May 4, 2007. Marvel has also agreed to provide services to Hasbro in connection with the licensed toys. The license guarantees Marvel $205 million in royalty and service fee payments, of which $70 million would be payable on the theatrical release of Spider-Man 3 and $35 million upon the theatrical release of Spider-Man 4. In addition, the license can be extended past the five year term, dependent on the number of other entertainment properties released during that timeframe.
"We are particularly pleased with this arrangement as it fits strategically into our plan to continually develop our home-grown core brands while aligning ourselves selectively with the best licenses in the business," Alfred J. Verrecchia, President and Chief Executive Officer of Hasbro, Inc. said.
"Hasbro's multi-year agreement with Marvel provides Hasbro with proven properties in categories where we have been long-time industry leaders," said Brian Goldner, Hasbro's President, U.S. Toy Segment. "Marvel's properties are a 'who's-who' in children's and family entertainment and provide Hasbro with many exciting opportunities in the years ahead."
Tim Rothwell, Worldwide President, Consumer Media Group, Marvel Entertainment, added, "Hasbro is renowned in the toy arena. It supports its key brands with heavy promotional and advertising campaigns and their innovation provides consumers with an unmatched retail experience. We believe aligning with Hasbro as our master toy and game partner sets the stage for us to further extend the global and domestic reach and image of the overall Marvel brand."
Bruno Maglione, President, Marvel International, commented, "As we continue the process of developing our brands through a heightened mix of coordinated multi-media and product activity it was important to engage with a partner who understands how to leverage and optimize that sort of evergreen franchise approach. Hasbro brings that experience to the table, and with it, the ability and reach to execute globally. It's a perfect match."
David Hargreaves, Chief Financial Officer of Hasbro, Inc, said, "We are very pleased with this deal as it provides Hasbro with incremental revenues in high margin categories and allows us to maintain an appropriate balance in our portfolio of core brands and strategic licenses."
Juli Boylan, Sr Vice President, Sony Pictures Consumer Products, the limited partner in Spider-Man Merchandising LP, stated, "We are thrilled to have Hasbro develop toys and games for Spider-Man 3. We are very proud of the Spider-Man film franchise and feel Hasbro will play a pivotal role in its continued success."
The license is conditioned on its clearance under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
About Hasbro, Inc.
Hasbro (NYSE:HAS) is a worldwide leader in children's and family leisure time entertainment products and services, including the design, manufacture and marketing of games and toys ranging from traditional to high-tech. Both internationally and in the U.S., its PLAYSKOOL, TONKA, MILTON BRADLEY, PARKER BROTHERS, TIGER, and WIZARDS OF THE COAST brands and products provide the highest quality and most recognizable play experiences in the world. ©2006 Hasbro, Inc. All Rights Reserved.
About Spider-Man Merchandising, LP
Spider-Man Merchandising, LP is the limited partnership comprised of Marvel Entertainment, Inc. and Sony Pictures Consumer Products Inc., which oversees the licensing and merchandising for the Columbia Pictures Spider-Man feature films, and is overseeing the licensing and merchandising for Columbia Pictures Spider-Man™ 3 feature film.
About Sony Pictures Consumer Products
Sony Pictures Consumer Products (SPCP), a Division of Columbia Tristar Consumer Marketing (CTCM), is based in Los Angeles and handles the merchandising and branding efforts for some of the most recognized properties in film and television. Columbia Tristar Consumer Marketing is a division of Sony Pictures Entertainment (SPE). SPE is a subsidiary of Sony Corporation of America (SCA), a subsidiary of Tokyo-based Sony Corporation. SPE's global operations encompass motion picture production and distribution; television production and distribution; digital content creation and distribution; worldwide channel investments; home entertainment acquisition and distribution; operation of studio facilities; development of new entertainment products, services and technologies; and distribution of filmed entertainment in 67 countries.
With a library of over 5,000 proprietary characters, Marvel Entertainment, Inc. is one of the world's most prominent character-based entertainment companies. Marvel's operations are focused in three areas: entertainment (Marvel Studios) and licensing, comic book publishing and toys (Toy Biz). Marvel facilitates the creation of entertainment projects, including feature films, DVD/home video, video games and television based on its characters and also licenses its characters for use in a wide range of consumer products and services including apparel, collectibles, snack foods and promotions. Marvel's characters and plot lines are created by its publishing segment that continues to expand its leadership position in the U.S. and worldwide while also serving as an invaluable source of intellectual property.
Except for any historical information that they contain, the statements in this news release regarding Marvel's plans are forward-looking statements that are subject to certain risks and uncertainties, including a decrease in the level of media exposure or popularity of Marvel's characters, financial difficulties of Marvel's licensees, changing consumer preferences, movie- and television-production delays and cancellations, toy-production delays or shortfalls, continued concentration of toy retailers, toy inventory risk, the imposition of quotas or tariffs on products manufactured in China and a decrease in cash flow even as Marvel remains indebted to its noteholders. These and other risks and uncertainties are described in Marvel's filings with the Securities and Exchange Commission, including Marvel's Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Marvel assumes no obligation to publicly update or revise any forward-looking statements.