IDT Offloads Mainframe Stake

VANCOUVER/NEWARK, July 20: IDT Entertainment, which is in
the process of being sold to Liberty Media, has inked a deal to sell its
62-percent stake in Canadian CGI outfit Mainframe Entertainment to the parent
company of Rainmaker Animation & Visual Effects.

The deal with the Rainmaker Income Fund subsidiary, RNK
Capital Limited Partnership, is expected to close on July 31. Rainmaker also intends
to acquire the balance of the shares of Mainframe. If it does so, the total
purchase price will be C$13.8 million. Upon completion of the transactions,
Rainmaker plans to combine the businesses of Mainframe and Rainmaker Animation
& Visual Effects. Warren Franklin, the president of Rainmaker Animation,
and Rick Mischel, the current CEO of Mainframe, will lead the new entity.
Rainmaker says the combined entity will be the largest animation and visual
effects studio in Canada, employing over 300 artists and technicians, with
offices in London and Los Angeles.

"At Rainmaker, we've long admired the work and track
record of Mainframe," said Franklin. "Both entities have been making
significant strides into each other's areas of expertise and the time is right
to harness our joint skills and talent pools. We're eagerly looking forward to
combining our ranks and continuing our growth momentum."

Mischel added, "The blending of our two businesses will
be good for both our clients and our staff. We will continue to each serve our
core clients while also expanding that base with our pooled creative services.
Mainframe's animators will provide Rainmaker with additional creative talent
and at the same time, will benefit greatly from access to Rainmaker's pipeline,
state-of-the-art film lab, and proprietary technology. We'll also be more
nimble in our plans for developing intellectual properties, especially with our
return to Canadian ownership."