YooMedia, the AIM-traded interactive media and games group, announces that it is
entering a long term strategic agreement with Europe's largest integrated
betting and gaming operator, Gala Group ('Gala'), involving its gaming channel,
Avago. Under this agreement, Gala is acquiring the Avago brand and associated
intellectual property together with the database of over 250,000 registered
customer accounts.
Gala intends to re-brand the channel and re-launch it by the end of the third
quarter of 2006. YooMedia continues to have a prominent interest in the
business, as well as continuing to provide its interactive gaming portal behind
the channel. The Avago channel is currently available on Sky Digital, channel
181, and will launch on NTL as the first 'live' presented interactive gaming
channel on UK cable in early 2006.
The terms of the agreement for YooMedia include an asset sale consideration, an
ongoing share of gaming revenues, and support and development contracts across
the initial period of in excess of three years. It is expected that the
financial benefit to YooMedia will be a net income contribution of between £5.1m
and £8.05m, depending on performance of the channel over the initial period.
The proceeds of the agreement will be used by YooMedia to continue to support
the relationship with Gala and to reinvest in the other parts of the Group, as
well as general working capital requirements.
YooMedia Chairman, Michael Sinclair, said: 'Having built a cross-platform
service, we are now delighted to have formed a partnership with the UK's leading
provider of high-volume, low-stake leisure gaming. The deal highlights our
ability to create value through our innovative approach in supplying digital
content for the fast-growing worldwide market. We look forward to working with
Gala, continuing to develop our cutting-edge software and being part of such a
strong and exciting brand.'
Gala Group Chief Executive Neil Goulden said: 'We are delighted to be entering
the dynamic world of interactive television and this project will form a key
part of Gala's expanding multi-media strategy. Gala TV will allow additional
opportunities for our existing registered membership of over seven million
customers to access Gala's products and services. It will also allow Gala to
promote its brand to a new audience across both the digital satellite and cable
platforms in the UK. '
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