LOS ANGELES, Sept. 18 /PRNewswire-FirstCall/ -- Napster (Nasdaq: NAPS)
announced today that in response to recent third party interest in
establishing strategic partnerships or potentially acquiring the company,
it has retained UBS Investment Bank to assist the Board and management in
its evaluation of strategic alternatives.
Chris Gorog, Napster's Chairman & CEO, said, "Napster is in a strong
position to continue aggressively building our business as an independent
company and we are pleased to also have the opportunity to thoughtfully
examine potential combinations that may further enhance Napster's unique
strategic and brand position in the center of digital media. Our goal is to
enhance shareholder value which could potentially lead to a new strategic
partnership or the sale of the company but in any event our primary focus
will remain on growing Napster."
Nand Gangwani, Napster's CFO, said, "Napster has a strong balance sheet
with a healthy cash position of $97 million as of the close of the first
quarter and we are currently generating annual revenues in excess of $100
million. For the second half of our fiscal year, we project a strong
up-tick in subscription growth from a base of more than half a million
subscribers and a significant expansion of our mobile business, including
the addition of new tier one wireless partners. We are also looking forward
to launching in Japan this fall as scheduled, expanding our global
footprint to include the top four music markets in the world."
The company advised that it has not set a definitive timetable for
completion of its evaluation and further that there can be no assurances
that the evaluation process will result in any specific transaction. The
company also advised that it does not intend to disclose developments
regarding its evaluation of strategic alternatives unless and until its
Board of Directors approves a definitive transaction.
About Napster
Napster is committed to making great music experiences more accessible
to all music fans. Napster.com gives web users the power to legally listen
on-demand to a massive catalog of music from major and independent labels,
wherever they are on the Web -- for FREE. The Napster music subscription
service offers a premium experience that includes unlimited access to
CD-quality music and advanced discovery, community and programming features
in an advertising-free environment. Napster To Go subscribers also enjoy
unlimited transfer of music to a compatible MP3 player. Napster Light, an a
la carte download store, and Napster Mobile, a hosted music service
featuring artist images, ring tones and full-length songs, round out the
Napster digital music lineup. Napster is headquartered in Los Angeles with
sales offices in Frankfurt and London. For more information, please visit
http://www.napster.com.
Safe Harbor Statement
Except for historical information, the matters discussed in this press
release, in particular matters related to the growth of Napster, potential
strategic partnerships or the acquisition of Napster, Napster's revenues,
subscriber growth, the expansion of Napster's mobile business,
relationships with tier one wireless providers and the launch of the music
service in Japan, contain forward-looking statements that are subject to
certain risks and uncertainties including the new and rapidly evolving
nature of digital media distribution and Napster's business model,
Napster's ability to add new subscribers and reduce churn, intense
competition, the failure to maintain strategic relationships, reliance on
content provided by third parties and failure of the Napster service to
interoperate with the hardware of Napster's customers, and provisions in
Napster's agreements, charter documents, stockholder rights plan and
Delaware law that may delay or prevent acquisition of us that could cause
actual results to differ materially from those projected. Additional
information on these and other factors are contained in Napster's reports
filed with the Securities and Exchange Commission (SEC), including the
Company's Quarterly Report on Form 10-Q as filed with the SEC on August 2,
2006, copies of which are available at the website maintained by the SEC at
http://www.sec.gov. Napster assumes no obligation to update the
forward-looking statements included in this press release.
Napster, Napster Light, Napster To Go and Napster Mobile are either
trademarks or registered trademarks of Napster, Inc. or its subsidiaries in
the United States and/or other countries. All other trademarks are owned by
their respective owners.
SOURCE Napster
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Related links:
http://www.napster.com
CONTACT:
Corporate Communications: Dana M. Harris of
Napster, +1-310-281-5000, dana.harris@napster.com; or Matt
Benson, mbenson@sardverb.com, or Wendy Fraser,
wfraser@sardverb.com, both at +1-415-618-8750, or Tracy
Greenberger, +1-212-687-8080, tgreenberger@sardverb.com, all of
Citigate Sard Verbinnen; or Investor Relations: Alex Wellins of
The Blueshirt Group, +1-415-217-5861, alex@blueshirtgroup.com
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