D&M Holdings Inc. Buys Assets Of Escient

28-Apr-03

D&M Holdings Inc. (TSE II: 6735), parent company of Denon, Ltd. and Marantz Japan, Inc., announced that it has made another acquisition that will enhance its global digital strategy. One week after announcing that it was the high bidder for the ReplayTVÆ (digital video recorder) and RioÆ (MP3) business units of the bankrupt SONICblue Incorporated, D&M Holdings purchased the assets of U.S.-based OpenGlobe, Inc. and Escient Convergence Corp., subsidiaries of Escient Technologies, LLC, a leading developer of digital home entertainment devices including the award-winning FireBallô digital music managers. Terms of the acquisition were not disclosed. These assets will form the new Escient Division within Digital Networks North America, Inc. (DNNA), the new platform established by D&M to further the development of core technologies in the emerging entertainment-based home networking market. Escient's flagship product is FireBall, an all-in-one digital audio jukebox that finds and plays both physical discs and digital music files while also displaying album cover art, album and song titles, and artist information through an on-screen interface. FireBall supports up to five managers for distribution of music around the home, receives weekly software updates through the Internet, and plays music from both Internet radio stations and higher-speed satellite radio stations. FireBall was named Best of CES for the Home Audio Category in 2002. D&M Holdings also announced the senior management leadership team for DNNA. Michael Seedman, a director of D&M Holdings, becomes Chairman of DNNA and Bernie Sepaniak, current Escient President and Chief Executive Officer, will remain as President of the Escient Division of DNNA. D&M Holdings anticipates that most of Escient's employees, including its accomplished technical team, will join DNNA.""Our goal is to provide access to entertainment anytime and anywhere throughout the home. This acquisition furthers that strategy,"" said Tatsuo Kabumoto, President and Chief Executive Officer of D&M Holdings. ""We welcome Bernie Sepaniak and the Escient team of digital technology experts to DNNA, our new platform for launching innovative home entertainment devices,"" he said.D&M Holdings expects this transaction to have a minimal effect on operational earnings per share. It is expected to be slightly dilutive in fiscal year 2003 and accretive thereafter. In addition, the company is currently evaluating whether as a result of this transaction a one-time, in-process research and development charge to earnings may be required.This announcement represents the company's fourth investment in technology to create entertainment-based digital home networking solutions. In addition to its pending acquisitions of ReplayTV and Rio, D&M Holdings also made an investment in 2002 in Mediabolic, a San Francisco-based company that provides an embedded software platform for entertainment devices. Denon will use the Mediabolic platform in new products that will be launched later this year.For more information about D&M Holdings, visit www.dm-holdings.com.

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