Cinram established its first major manufacturing presence in the United States in 1990 with the acquisition of one of the country's largest independent duplicators of audio cassettes- PRC Tape Company of Richmond, Indiana. In 1995, we entered the European market with the acquisition of two VHS video cassette duplicators: Duplication France, S.A. and Video Pouce, S.A. Throughout the remainder of the 1990s, Cinram completed several acquisitions in both North America and Europe to establish our market presence and expand our operations in those territories.

In 2000, Cinram entered into exclusive agreements with Twentieth Century Fox Home Entertainment Inc. (Fox), a major North American motion picture studio, to provide manufacturing, distribution and warehouse logistics services for VHS video cassettes and DVDs in the United States and Canada. That same year, we acquired the shares of Universal Music International Manufacturing and Logistics, S.A. (UML) in France and signed a long-term CD supply contract with UML- providing a solid foundation for our CD business in Europe.

In 2002, we added significant DVD capacity in North America, and to a lesser extent in Europe, as a result of the growing consumer demand for DVDs and additional business from new, exclusive DVD supply agreements entered into during the year.

In 2003, we completed the largest strategic acquisition in our history. We acquired Time Warner Inc.'s DVD and CD manufacturing and physical distribution businesses, together with certain related businesses, in the United States and Europe, for $1,150.5 million in cash.

As part of the transaction, we also entered into exclusive, long-term agreements to manufacture, print, package and physically distribute DVDs and CDs for Warner Home Video and Warner Music Group in North America and Europe, and for New Line Home Entertainment, Inc. in North America. The transaction closed in October 2003 and increased Cinram's DVD and CD manufacturing capacity to over one billion discs per year. The purchase price was funded from banking facilities comprised of term loans totalling $1,025.0 million and revolving credit facility of $150.0 million. Accordingly, Cinram's revenue, earnings and earnings per share all reached record levels in 2003.

In November 2004, we signed an exclusive, multi-year manufacturing and distribution agreement with Fox in Europe; however, we began manufacturing and distributing DVDs and VHS video cassettes for Fox in France under a transitional agreement in August 2004. We began manufacturing and distributing Fox products in the United Kingdom, Germany and the Benelux in the first half of 2005.

Today, we are the world's largest independent provider of pre-recorded multimedia products and related logistics services and have the capacity to manufacture 1.77 billion DVDs per year. Our major customers include Warner Home Video, Warner Music Group, New Line Home Entertainment, Twentieth Century Fox Home Entertainment (Fox), Metro-Goldwyn-Mayer Home Entertainment (MGM), Artisan Entertainment/Lions Gate, Alliance Atlantis and EMI Group plc (EMI).