LOVEFiLM Takes Amazon’s U.K., German DVD Rental Business

LUXEMBOURG, February 4:
The European DVD rental subscription service LOVEFiLM has reached a deal to
acquire Amazon Europe’s DVD rental business in the U.K. and Germany.

As part of the deal,
Amazon Europe is making a cash investment in LOVEFiLM International, becoming
the company’s largest shareholder. LOVEFiLM provides a DVD rental subscription
service in the U.K., Sweden, Norway, Denmark and Germany, delivering more than
65,000 unique titles (including games), cinema listings and ticket sales, as
well as a film download service. LOVEFiLM International was formed in 2006 from
the 50:50 merger between LOVEFiLM, an Arts Alliance Media-founded company, and
Video Island, backed by three leading European venture capital funds: Index
Ventures, Balderton Capital and DFJ Esprit.

The transaction announced
today also covers a multi-year marketing agreement in which Amazon Europe will
promote LOVEFiLM’s services on its sites for U.K. and German customers.
Following completion of the deal, the new LOVEFiLM subscriber base will total
more than 900,000 customers, predominantly in the U.K. and Germany, but also in
Sweden, Norway and Denmark.

"As one of Europe’s
largest online DVD rental businesses, LOVEFiLM is well established to serve
customers’ increasing demand for entertainment," said Greg Greeley,
Amazon’s VP of European retail. "Our investment will enable LOVEFiLM to grow
the business further and we are excited to be part of their future."

Simon Calver, the CEO of
LOVEFiLM International, added: "Customers are faced with an astonishing
array of choices in the entertainment world these days. LOVEFiLM International
will ensure that Amazon Europe’s customers get the best possible DVD rental
service. We will be delighted to welcome all Amazon Europe customers to the
LOVEFiLM service. This new, bigger customer base will give us an even better
position from which to build LOVEFiLM as the best place for customers to find
film."

—By Mansha Daswani