Japanese publisher Kadokawa Holdings Inc. announced it will sell its 2.91% stake in DreamWorks SKG to Paramount Pictures for about $21 million by the end of February, according to VARIETY.
This week, Paramount, a unit of Viacom Inc., finalized its purchased of the previously privately held DreamWorks in a $1.6 billion cash-and-debt deal.
Kadokawa invested $100 million in DreamWorks in 2004 to obtain the exclusive Japanese rights to distribute the studio's films, videos, DVDs and other products. As part of the sale, Kadokawa will retain these rights to at least 31 films through 2018. The company expects the initial sales to result in a loss of approximately $22 million, but expects the profits from the remaining rights to offset that loss within three years.
For the current year to March, however, Kadokawa lowered its group net profit forecast by 84% to ¥500 million due to the extraordinary loss. Shares in Kadokawa closed up 0.28% at ¥3,620.