Technicolor announced it is in advanced talks to sell its patent licensing business.
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Unedited press release follows:
Technicolor Negotiating Strategic Transaction Concerning its Patent Licensing Business
Impact on 2017 objectives. Operating Businesses performance in line with expectations.
Paris (France), 18 December 2017 – Technicolor (Euronext Paris: TCH; OTCQX: TCLRY) announces it is in negotiations for a strategic transaction relating to its patent licensing business. While there is no assurance that a transaction will take place, Technicolor is confident it will reach an agreement. This is in line with Technicolor’s objective to simplify the Group’s structure and allocate its capital and resources to its operating businesses.
In the course of negotiating this strategic transaction, Technicolor suspended its commercial patent licensing discussions. Technicolor has, however, reached a settlement agreement with Samsung Electronics with regard to ongoing litigations in Germany and France.
The Technology segment is consequently expected to generate around €70 million of Adjusted EBITDA (out of which €75 million from the patent licensing business) and around €25 million of free cash flow, instead of an estimated €115 million of Adjusted EBITDA and €100 million of free cash flow incorporated in the low end of the Group’s full year guidance.
The performance of the operating businesses is in line with the Group’s expectations.
Consequently, Technicolor anticipates generating an Adjusted EBITDA around €370 million, including a negative forex impact comprised between €5 million and €10 million, and a free cash flow of around €75 million before cash settlements in the Cathode Ray Tube cartel case[1].
All figures above are estimated and unaudited.
About Technicolor
Technicolor, a worldwide technology leader in the media and entertainment sector, is at the forefront of digital innovation. Our world class research and innovation laboratories enable us to lead the market in delivering advanced video services to content creators and distributors. We also benefit from an extensive intellectual property portfolio focused on imaging and sound technologies. Our commitment: supporting the delivery of exciting new experiences for consumers in theaters, homes and on-the-go.