Canuck co. to develop multimedia projects
MONTREAL Cinar Corp. of Montreal has inked a deal with San Diego-based Internet/education company the Lightspan Partnership to invest in Lightspan and develop multimedia projects together. Cinar has agreed to purchase 2.5 million shares of Lightspan for $12.5 million and, in the future, to acquire, subject to all regulatory approvals, another $10 million of common stock in a private placement. In addition, Cinar was granted warrants to acquire an additional 500,000 shares of Lightspan Series-E preferred shares.
The two companies will also collaborate on a number of strategic initiatives, notably an educational television series that will also be broadcast on the Internet, the co-development of an Internet portal for preschoolers and educators featuring products from Cinar-owned company HighReach Learning, and a series of marketing and distribution arrangements for Lightspan products. Cinar president and co-CEO Ronald Weinberg will join Lightspan’s board of directors.
Over the past two weeks, Cinar has been at the center of a major political scandal in Canada, with members of the opposition party Bloc Quebecois alleging in the House of Commons that Cinar has engaged in tax-credit fraud. None of these allegations have been proved and a Royal Canadian Mounted Police investigation is ongoing. Dan Tierney, VP of business development at Cinar, said its execs are not allowing the controversy to stop the company’s expansion plans.
“It’s business as usual at the company,” said Tierney. “We’re not losing our focus and we’re moving forward strategically.”
The Lightspan Partnership is a provider of curriculum-based educational software and Internet products for use at home and in school. Cinar, which produces and distributes children’s TV programming, is becoming increasingly involved in the educational sector.