Entertainment One buys Canadian distributor Phase 4 Films for $27 million

TORONTO – Film distributor Entertainment One, the company behind the Canadian rights to the “Twilight” and “The Hunger Games” franchises, has reached an agreement to buy independent distributor Phase 4 Films for $27 million.

The deal will add Phase 4’s extensive library of genre titles which skew towards independently produced action and horror films.

The companies said the transaction includes $19.3 million in cash and 1.4 million shares.

Phase 4 was one of the first distributors to test the simultaneous release of films in theatres and on-demand, something Hollywood still struggles to embrace. The company holds the rights to snowboarding documentary “The Crash Reel” and the Canadian rights to Kevin Smith’s “Red State.”

Since last year, Phase 4 has signed distribution agreements with The Criterion Collection and Shout! Factory to handle classic film and television content.

“Since its inception, Phase 4 has delivered good growth and we are confident that, as part of the group, the enlarged U.S. business will realize further opportunities,” EOne chief executive Darren Throop said in a statement.

As part of the transaction, Phase 4 president and CEO Berry Meyerowitz will assume the role of president at EOne’s U.S. film and distribution business.

For the year ended March 31, Phase 4 reported $4.1 million in earnings before taxes and $51.7 million in revenue.

EOne distributes independent films in the United States, the U.K., Australia and Spain. It also produces several TV shows filmed in Canada, including “Rookie Blue” and “Hell on Wheels,” and holds some international rights to “The Walking Dead.”

The company has been building its business buy acquiring other distributors around the globe, and in 2012 reached an agreement to acquire Alliance Films for approximately $225 million.