Play Meter
Issue: 1976 December - Vol 2 Num 15 - Page 1
m®o~ o~CIDru~rn\Y
PlAt' lti£T£R
December, 1976
Vol 2 No. 15
Columbia Pictures Buys Gottlieb
Alan J . Hirschfield, president of
Columbia Pictures Industries, Inc.,
has announced that it has entered
into an agreement to acquire all of
the outstanding stock of privately-
held D. Gottlieb & Co. Gottlieb
pioneered the development of the
non-gambling coin-operated pinball
machine fifty years ago and today is
the world's largest manufacturer of
such amusement machines, accord-
ing to Hirschfield.
Hirschfield noted that this acqui-
sition presents an opportunity to
explore entry into the rapidly-ex-
panding home entertainment mar-
ket in addition to Columbia's mov-
ing into a growing worldwide a-
musement market that comple -
ments its film, television, record and
commercial activities.
Hirschfield also stated, "This
acquisition comes as a logical
consequence of the overall plan
carried out at Columbia over the last
three years. After accomplishing an
initial turnaround , we succeeded in
substantially reducing our bank
debt, in divesting the company of
certain operations and in achieving
significant improvements in our
management efficiency and in the
level of our operating profits . We
felt that process was completed
early this fall and we began a
thorough search for the kind of
acquisition we are now announcing.
Gottlieb is a major company in a
growing industry that we feel will
add to our earnings base and wm
introduce stability into our overall
results ." Hirschfield went on to say
that " with more than 1600 employ-
ees, two manufacturing plants in
Illinois and one in Fargo, N.D.,
Gottlieb meets Columbia's estab-
lished acquisition criteria of a strong
financial position, an outstanding
record of growth and experienced
management."
Terms of the acquisition call for
Columbia to purchase Gottlieb's
common stock for $47 million of
which $6 million will be paid on
closing , $24 million on January 3,
1977 and the balance in installments
during the calendar years 1977
through 1982, subject to deferral in
certain events. In addition, the
common stockholders of Gottlieb
will receive options to purchase an
aggregate of 400,000 shares of
Columbia common stock at $10 per
share, subject to reduction of the
option price based on a formula
should the market price of Columbia
common stock exceed $10. As Play
Meter went to press, Columbia
stock' s Big Board exchange value
was $7.25 per share .
Columbia has also agreed to
purchase all outstandin!l Gottlieb
preferred stock for $3.3 million on a
deferred payment basis effective no
earlier than 1980.
The transaction , which has been
approved by Columbia's Board of
Directors, is subject to, among
other conditions, consent of Colum-
bia 's lending institutions from whom
the firm will re-borrow approximate-
ly $22 million with regard to this
transaction . This represents ap -
proximately the amount received by
Columbia from the sale of its music
publishing business. After closing.
D. Gottlieb & Co. will operate as a
wholly-owned subsidiary of Colum-
bia under its present management
who will serve with long -term
employment contracts.
Hirschfield estimated that for the
twelve months ending December
31 , 1976, D. Gottlieb & Co . will
report consolidated net income
before taxes of more than $11.5
million and that at closing the
consolidated net worth of Gottlieb
should approximate $24 million and
$17 million, respectively.
OtiCoin Sold at Auction
The assets of Chicago Dynamics
Industries was offered for sale at
public Auction Dec . 13. COl is
parent company to Chicag·o Coin .
The property offered for sale, in
bulk only, included all the goods of
the company located at both Chica -
go addresses . This included all
furnishings , fixtures , machinery,
tools and equipment. A lso for sale
was the entire inventory of the
company, including all coin-opera-
ted machines, amusement devices
and games, all raw materials, parts,
supplies, goods-in -process and fin -
ished goods. "General intangibles"
(not including registered patents
and trademarks) in which Chicago
Dynamics had an interest were also
included in the sale .
The sale was offered by Central
National Bank in Chicago and Main
lconunued overpagel
PlAt' lti£T£R
December, 1976
Vol 2 No. 15
Columbia Pictures Buys Gottlieb
Alan J . Hirschfield, president of
Columbia Pictures Industries, Inc.,
has announced that it has entered
into an agreement to acquire all of
the outstanding stock of privately-
held D. Gottlieb & Co. Gottlieb
pioneered the development of the
non-gambling coin-operated pinball
machine fifty years ago and today is
the world's largest manufacturer of
such amusement machines, accord-
ing to Hirschfield.
Hirschfield noted that this acqui-
sition presents an opportunity to
explore entry into the rapidly-ex-
panding home entertainment mar-
ket in addition to Columbia's mov-
ing into a growing worldwide a-
musement market that comple -
ments its film, television, record and
commercial activities.
Hirschfield also stated, "This
acquisition comes as a logical
consequence of the overall plan
carried out at Columbia over the last
three years. After accomplishing an
initial turnaround , we succeeded in
substantially reducing our bank
debt, in divesting the company of
certain operations and in achieving
significant improvements in our
management efficiency and in the
level of our operating profits . We
felt that process was completed
early this fall and we began a
thorough search for the kind of
acquisition we are now announcing.
Gottlieb is a major company in a
growing industry that we feel will
add to our earnings base and wm
introduce stability into our overall
results ." Hirschfield went on to say
that " with more than 1600 employ-
ees, two manufacturing plants in
Illinois and one in Fargo, N.D.,
Gottlieb meets Columbia's estab-
lished acquisition criteria of a strong
financial position, an outstanding
record of growth and experienced
management."
Terms of the acquisition call for
Columbia to purchase Gottlieb's
common stock for $47 million of
which $6 million will be paid on
closing , $24 million on January 3,
1977 and the balance in installments
during the calendar years 1977
through 1982, subject to deferral in
certain events. In addition, the
common stockholders of Gottlieb
will receive options to purchase an
aggregate of 400,000 shares of
Columbia common stock at $10 per
share, subject to reduction of the
option price based on a formula
should the market price of Columbia
common stock exceed $10. As Play
Meter went to press, Columbia
stock' s Big Board exchange value
was $7.25 per share .
Columbia has also agreed to
purchase all outstandin!l Gottlieb
preferred stock for $3.3 million on a
deferred payment basis effective no
earlier than 1980.
The transaction , which has been
approved by Columbia's Board of
Directors, is subject to, among
other conditions, consent of Colum-
bia 's lending institutions from whom
the firm will re-borrow approximate-
ly $22 million with regard to this
transaction . This represents ap -
proximately the amount received by
Columbia from the sale of its music
publishing business. After closing.
D. Gottlieb & Co. will operate as a
wholly-owned subsidiary of Colum-
bia under its present management
who will serve with long -term
employment contracts.
Hirschfield estimated that for the
twelve months ending December
31 , 1976, D. Gottlieb & Co . will
report consolidated net income
before taxes of more than $11.5
million and that at closing the
consolidated net worth of Gottlieb
should approximate $24 million and
$17 million, respectively.
OtiCoin Sold at Auction
The assets of Chicago Dynamics
Industries was offered for sale at
public Auction Dec . 13. COl is
parent company to Chicag·o Coin .
The property offered for sale, in
bulk only, included all the goods of
the company located at both Chica -
go addresses . This included all
furnishings , fixtures , machinery,
tools and equipment. A lso for sale
was the entire inventory of the
company, including all coin-opera-
ted machines, amusement devices
and games, all raw materials, parts,
supplies, goods-in -process and fin -
ished goods. "General intangibles"
(not including registered patents
and trademarks) in which Chicago
Dynamics had an interest were also
included in the sale .
The sale was offered by Central
National Bank in Chicago and Main
lconunued overpagel
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