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News Title: |
AOL Time Warner Shops Replication/Packaging Units |
| Published on: |
03/14/2003 |
| Published by: |
www.medialinenews.com |
| Category: |
Companies |
| Description: |
New York - Seeking to retire some of its massive debt, AOL Time Warner is peddling its WEA Manufacturing and Warner Media Services optical disc replication and packaging divisions, according to published reports.
The reports came amidst continued talk that German media conglomerate Bertelsmann is in negotiations to sell Sonopress, its own disc replication division. Sources speak of independent replicator Cinram as the leading candidate to acquire either operation (or incredulously, both). Cinram has not issued comment on any of its acquisition plans, and neither Warner nor Bertelsmann have made any official statements of their own.
WEA Inc. - parent company of Warner Media Services, WEA Manufacturing, and distribution arm WEA Corp. - only recently completed a sweeping reorganization at the hands of new CEO Jim Caparro and president John Esposito, who previously headed up PolyGram Group Distribution. Key executive changes under the new leadership included the naming of former Ivy Hill president Arthur Kern as president of Warner Media Services, and the hiring of Thomas Costabile, former senior vice president of operations at Sony Disc Manufacturing, as president of WEA Manufacturing.
The restructuring also entailed the shuttering of six offices and downsizing by 50 employees. Staff reductions are apparently continuing at DVD manufacturing pioneer Warner Advanced Media Services, with the reported departure of several key executives.
WEA Manufacturing maintains two CD/DVD replication plants in Pennsylvania and southern California, with annual capacity at 200 million CDs and 250 million DVDs. Warner Media Services has four U.S. facilities for packaging and printing. In addition to serving WEA Inc. parent Warner Music Group, the two operations fulfill the DVD needs of Warner Home Video as well as a number of third-party customers.
Caparro remarked to Billboard last month that the organization had undergone a "complete transformation," enabling the operations to be more responsive to retail conditions, and offering a stronger turnkey production solution for third parties.
The would-be news of sales talks comes as no surprise to major record label veterans. "Sonopress has always been for sale; WEA Manufacturing has always been for sale," one insider remarked, observing that while sprawling manufacturing operations have never been among a record company's core assets, they've historically been too large to sell to an independent under favorable terms. |
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