Agreement to acquire Phase 4 Films

Entertainment One Ltd.

Agreement to acquire the Phase 4 Films group of companies

Entertainment One Ltd. is pleased to announce that it has agreed to acquire the Phase 4 Films group of companies ("Phase 4"), a leading independent film and television distributor based across Canada and the United States, from the Phase 4 Sellers.

Phase 4 specialises in the sales, marketing, licensing and distribution of feature films, television and special interest content across all media in the North American market. The acquisition of Phase 4 will provide incremental scale and growth opportunities for the Group's US Film Division.

The acquisition is for a total consideration of C$27 million, satisfied by the issue of 1,412,062 common shares in Entertainment One Ltd. (the "Consideration Shares") and approximately C$19.3 million in cash.

In the year to 31 March 2014, Phase 4 generated unaudited revenue of C$51.7 million and unaudited earnings before income taxes of C$4.1 million. As at 31 March 2014, Phase 4 had unaudited gross assets of C$37.1 million.

Phase 4 is led by Berry Meyerowitz (President and CEO) and all of the Phase 4 team will remain with the business. Following completion, Berry will be appointed President of eOne's Film businesses in the United States.

Following completion of the acquisition, application will be made for the admission to trading of the Consideration Shares, which will rank paripassu in all respects with the existing common shares. Completion is expected to take place on or around 3 June 2014.

Phase 4 comprises: SMCAD Holdings Inc., SMUSD Holdings Inc., SydygirlCAN Holdings Inc., SydygirlUSA Holdings Inc., Phase 4 Films Inc., Phase 4 Canada Holdings Inc. and 310 Canada Holdings Inc..

The Phase 4 Sellers comprise: Berne (Berry) P. Meyerowitz, Jomar Family Trust, Sean Monson, Monson Family Trust, David Scott Richardson, Richardson Family Trust and Jennifer Strasberg.

Darren Throop, Chief Executive Officer, commented: 

"We are delighted that the Phase 4 team is joining eOne, bringing with them in-depth industry expertise to the Film Division. Since its inception, Phase 4 has delivered good growth and we are confident that, as part of the Group, the enlarged US business will realise further opportunities."

J.P. Morgan Securities plc is acting as corporate broker to the Company and no one else and will not be responsible to any other person for providing the protections afforded to clients of J.P. Morgan in connection with any matter referred to herein.

Notes to Editors:

About Entertainment One

Entertainment One Ltd. (LSE:ETO) is a leading international entertainment company that specialises in the acquisition, production and distribution of film and television content. The Company's comprehensive network extends around the globe including Canada, the US, the UK, Ireland, Spain, Benelux, France, Germany, Scandinavia, Australia, New Zealand, South Africa and South Korea.

The Company provides extensive expertise in film distribution, television and music production, family programming and merchandising and licensing. Its current rights library is exploited across all media formats and includes more than 35,000 film and television titles, 2,800 hours of television programming and 45,000 music tracks.

Further information is available at www.entertainmentonegroup.com or email Redleaf Polhill at [email protected].