Sony’s Funimation Global Group Completes Acquisition of Crunchyroll from AT&T

Share on facebook
Share on twitter

Sony has completed its major purchase of Crunchyroll announced late last year sealing up a large portion of anime streaming and home video distribution worldwide. Not that long ago the idea of Aniplex, Funimation and Crunchyroll being sister companies seemed impossible but here we are and all 3 are now housed under Sony. Many worried the initial Aniplex/Funimation piece would hurt fans but so far it’s been the opposite. More Aniplex titles have been available for streaming on Funimation and titles are starting to be distributed via Funimation as well leading to lower costs to customers who want to buy these series, while still offering the limited editions Aniplex is known for.

What will happen with Crunchyroll and Funimation together remains to be seen. However, it’s anticipated that Crunchyroll will continue to focus on subs, with Funimation focusing on dubs as they do today. The combination of the two with Sony’s backing will allow them to grab more licenses and better quality home video releases (hopefully improving on those Funimation issues of the past). Both companies previously had a partnership through VRV a few years back but that quickly ended after a short time, with no real indication on why.

What do you think about this latest merger? Check out the press release below.

CULVER CITY, CA AND DALLAS, TX, August 9, 2021 — Sony Pictures Entertainment Inc. (SPE) and AT&T Inc.* (NYSE:T) today announced that SPE has completed its acquisition of  AT&T’s Crunchyroll anime business through Funimation Global Group, LLC. Funimation is a joint venture between SPE and Sony Music Entertainment (Japan) Inc.’s subsidiary, Aniplex Inc. The agreement was first announced in December 2020.

Crunchyroll is a premier anime direct-to-consumer service with 5 million SVOD subscribers and growing.  It serves 120 million registered users across more than 200 countries and territories offering AVOD, mobile games, manga, events merchandise and distribution. The deal provides the opportunity for Crunchyroll and Funimation to broaden distribution for their content partners and expand fan-centric offerings for consumers.

“We are very excited to welcome Crunchyroll to the Sony Group,” said Kenichiro Yoshida, Chairman, President and CEO, Sony Group Corporation. “Anime is a rapidly growing medium that enthralls and inspires emotion among audiences around the globe. The alignment of Crunchyroll and Funimation will enable us to get even closer to the creators and fans who are the heart of the anime community.  We look forward to delivering even more outstanding entertainment that fills the world with emotion through anime.”

“Crunchyroll adds tremendous value to Sony’s existing anime businesses, including Funimation and our terrific partners at Aniplex and Sony Music Entertainment Japan,” said Tony Vinciquerra, Chairman and CEO of Sony Pictures Entertainment Inc. “With Crunchyroll and Funimation, we are committed to creating the ultimate anime experience for fans and presenting a unique opportunity for our key partners, publishers, and the immensely talented creators to continue to deliver their masterful content to audiences around the world.  With the addition of Crunchyroll, we have an unprecedented opportunity to serve anime fans like never before and deliver the anime experience across any platform they choose, from theatrical, events, home entertainment, games, streaming, linear TV — everywhere and every way fans want to experience their anime. Our goal is to create a unified anime subscription experience as soon as possible.”

The purchase price for the transaction is $1.175 billion, subject to customary working capital and other adjustments, and the proceeds were paid in cash at closing.  AT&T expects to use the proceeds from this transaction to help support its debt reduction efforts, with plans to reach a net debt-to-adjusted EBITDA of below 2.5x by year-end 2023.[1]

[1] Net Debt to Adjusted EBITDA ratios are non-GAAP financial measures that are frequently used by investors and credit rating agencies to provide relevant and useful information. AT&T’s Net Debt to Adjusted EBITDA ratio is calculated by dividing the Net Debt by the sum of the most recent four quarters Adjusted EBITDA. Adjusted EBITDA estimates depend on future levels of revenues and expenses which are not reasonably estimable at this time. Accordingly, we cannot provide a reconciliation between Adjusted EBITDA and the most comparable GAAP metric without unreasonable effort.

 

Robert Prentice