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Thomson Multimedia to Acquire the Grass Valley Group

Company says acquisition to strengthen its position as supplier of integrated and networked broadcast products (December 14, 2001)
Thomson multimedia announced today that it has entered into an agreement to acquire the Grass Valley Group, a privately held digital media company headquartered in Nevada City, California.

The Grass Valley Group manufactures digital broadcast equipment and Internet streaming products. It offers hardware and software for creating, storing, manipulating, and distributing high-quality video content. Its installed base of servers, switchers, routers, modular products and digital news production solutions touch nearly 80 percent of the world's television signals. The company had revenues of approximately $200 million in 2000 calendar year.

The foreseen acquisition will further extend Thomson Broadcast's digital product portfolio and strengthen its position as a key supplier of integrated and networked broadcast devices for content providers. Valued at U.S. $172 million to be paid in cash at closing, the transaction remains subject to regulatory approvals and is expected to be completed in the first half of 2002. After synergies, Thomson expects this transaction to be accretive for its shareholders in the first full year of operation.

"There will be a significant gain in this combination for our customers in professional content creation, editing and distribution -- no matter where they are in the digital media chain. The Grass Valley Group's video expertise will leverage our capacity to help video professionals work on any content, any time, any place" said Marc Valentin, Vice President -- Thomson Broadcast Solutions business.

"Becoming part of a global portfolio company focused on the digital media opportunity is one of the best things that could happen to the Grass Valley Group's customers and to the company itself." said Tim Thorsteinson, President and CEO of the Grass Valley Group. "In a nutshell, it means uninterrupted product delivery, accelerated research and development, and tremendous distribution and service reach".

The proposed transaction fits into the development strategy of Thomson's Digital Media Solutions (DMS), a business segment focused on business-to-business solutions for content providers, broadcasters and network operators. Early this year, Thomson enlarged its broadcast activities when it acquired a majority interest in the Philips Professional Broadcast Group. Already a leader in Europe, the transaction will reinforce Thomson access to a very strong U.S. professional customer base.

Consummation of transaction will create a combined entity able to offer complementary technologies and a complete range of networked products and end-to-end solutions for the video value chain--one with an increased geographical reach and a reinforced ability to leverage the broadband opportunity. Specifically Thomson will benefit from:

-- An Outstanding Product Portfolio. Thomson's product offering will be enlarged with a portfolio of flexible and standards-based products for integrated infrastructures. This combined product offering would include a range of switchers, routers, modular products, storage area network (SAN) systems and video servers, and digital news production systems.

-- A Greater Geographical Coverage. As a result of an enlarged customer base, Thomson will be able to expand the reach of its products and solutions, in particular its acquisition and capture businesses (Camera and Digital film).

-- A Reinforced Broadband Offering. Thomson will extend its ability to help professionals make the full transition to digital, including the optimization of their media asset management, by reinforcing its position in the fastest growing networked broadcast market segment leveraging Grass Valley Group's expertise in video compression, storage, and networking technologies.

About Thomson Multimedia
With sales of 9.1 billion euros (U.S. $ 8.3 billion) in 2000 and 73,000 employees in more than 30 countries, Thomson multimedia (Paris Euroclear: 18453) (NYSE:TMS), provides a wide range of video (and enabling) technologies, systems, finished products and services to consumers and professionals in the entertainment and media industries. To advance and enable the digital media transition, Thomson multimedia has five principal activities: Digital Media Solutions, Displays and Components, Consumer Products, Patents and Licensing and New Media Services. The company distributes its products and services under the THOMSON, RCA and TECHNICOLOR brand names. For more information:

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Related Keywords:Broadcast Newsroom, Thomson multimedia, agreement to acquire the Grass Valley Group, digital media company, Nevada City, California

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