LOS ANGELES -- Fox Inc. said Monday it has completed the previously announced sale of its 75-year-old DeLuxe Laboratories to the Rank Organisation PLC for $150 million cash.
The deal for DeLuxe, which competes with Carlton Communications' Technicolor for the major processing work in the film industry, had been originally announced in March.
But the deal was held up by an antitrust lawsuit filed by the U.S. Justice Department.
The suit, filed last summer, alleged that Rank's acquisition of DeLuxe could 'substantially tend to lessen competition or create a monopoly' in North America's $140-million-a-year market for producing prints for feature films.
London-based Rank, which already serves the European market with a lab in Denham, England, owns a Toronto-based film lab and post- production facility, Film House Group Inc. The government's suit said that DeLuxe and Film House would control 51 percent of the U.S. market if the deal went through.
However, U.S. District Judge Terry Hatter recently ruled that the acquisition would not 'substantially lessen' competition in Southern California, which is the area where most of the major studios purchase film lab services.
Hatter also said that it was unlikely that the studios would use a lab outside Hollywood for release printing.
Fox's Australia-based parent company, Rupert Murdoch's News Corp., will be able to use the funds from the sale to pay down some of the company's substantial debt load, estimated at more than $8 billion.
Fox and Rank said in a joint release, 'We believe the acquisition of DeLuxe by Rank represents an exciting opportunity for DeLuxe and its employees, and is in the best interests of the entertainment industry as a whole,'
DeLuxe, originally the Fox Film Laboratory, employs about 450 people at its facilities in Hollywood. Fox executives have said that Rank plans to expand the operation.
