According to Techcrunch, Amazon is set to acquire European DVD rental service LOVEFiLM in a $312 million deal. The company currently operates in the UK, Germany, Sweden, Norway and Denmark. Amazon already owns a significant proportion of the equity in the company at around 42%.
Simon Calver, Chief Executive of LOVEFiLM International, was keen to point out what he believes are key benefits to the company going forward:
“The deal is a winner for the members who love LOVEFiLM because of its value, choice, convenience and innovation in home entertainment.” “With Amazon’s unequivocal support we can significantly enhance our members’ experience across Europe.”
Lovefilm was primarily a DVD rental business when it was launched in 2003. In recent years, however, the business has diversified into console games and streaming media to a variety of platforms. The company is no stranger to mergers, having created itself out of a series of mergers and aquisitions.
The deal has been subject to protracted negotiations since September 2010. It is still subject to regulatory approval and questions have been raised as to how Amazon will incorporate the European giant into its portfolio. It is unknown at this time weather the LOVEFiLM brand will be maintained or whether it will be absorbed into Amazon’s existing media rental business.