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TWTR Press Release 08/03/2000 Page 1 of 2
EXHIBIT 99.1
TWEETER HOME ENTERTAINMENT GROUP ANNOUNCES AN AGREEMENT IN PRINCIPLE TO ACQUIRE
DOUGLAS TV, THE BIG SCREEN STORE, A FOUR-STORE CHAIN LOCATED IN CHICAGO.
CANTON, MA. August 3, 2000 -- Tweeter Home Entertainment Group, Inc., (Nasdaq:
TWTR) announced today that it has reached an agreement in principle to acquire
Douglas TV, Inc., located in the greater Chicago, Illinois area. Douglas TV is a
five-store specialty consumer electronics retailer with annual sales of
approximately $28 million, and has been in business in the Chicago market for
over 30 years. The companies expect to complete the transaction on or about
October 1, 2000. The agreement in principle to acquire Douglas TV is subject to
various terms and conditions, and is subject to regulatory approval.
Tweeter will pay approximately $5.75 million dollars for the company excluding
acquisition costs, and has the option of paying approximately $1.5 million of
the purchase price in Tweeter common stock issued under its shelf registration
filed on April 13, 1999.
Jeffrey Stone, Tweeter's President and Chief Executive Officer said, "The
Douglas TV merger is another important step in Tweeter's growth. It is our first
acquisition of a specialty retailer that is not a member of the PRO buying group
and our first acquisition in an existing market for us. Douglas TV has a
significant television business with over 60% of their mix in TV. Even more
impressive is the fact that 17% of the business is digital or digital ready TV!
We will bring our expertise in audio to these stores over the next several years
and hope to positively impact their comp store sales through the execution of
our audio strategies. Coupled with our April 2000 acquisition of United Audio
Centers in Chicago, Douglas gives us an expanded presence in this dynamic
marketplace. We will be combining operations immediately, but will not change
the name until after January 1, 2001."
According to Joe McGuire, Tweeter's CFO, "We expect that the acquisition of
Douglas TV will be accretive to EPS by a penny or so for fiscal 2001. Once we
consolidate brand-names in the Chicago marketplace after the first of the year,
we expect to achieve some operating leverage."
Tweeter Home Entertainment Group, Inc. (Nasdaq: TWTR) was founded in 1972 by
current Chairman Sandy Bloomberg. Based in Canton, Massachusetts, the company is
a specialty retailer of mid- to high-end audio and video consumer electronics
products. The company's fiscal 1999 revenues were $283.3 million, and it was
named "Consumer Electronics Retailer of the Year" for 1996, 1997 and 1999 by
AudioVideo International Magazine, the country's leading consumer electronics
industry trade publication. The company employs approximately 2,100 associates.
It operates 86 stores under the Tweeter, etc, Bryn Mawr Stereo & Video, HiFi
Buys, and United Audio Centers names in the New England, Mid-Atlantic,
Southeastern, Texas, San Diego and Chicago markets, respectively.
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For further information, contact Anne-Marie Boucher at 781 830 3478,
fax 781 830 3223 or email at [email protected]. Additional information on
Tweeter Home Entertainment Group can also be found on the company's
web site at www.twtr.com.
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TWTR Press Release 08/03/2000 Page 2 of 2
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Certain statements contained in this press release, including, without
limitation, statements containing the words "expects," "anticipates,"
"believes," and words of similar import, constitute "forward looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995. The
financial and other projections included in this press release concerning
Douglas TV's results following the planned acquisition are based on various
assumptions, including that Tweeter will complete the acquisition as currently
contemplated. It is possible that Tweeter's acquisition of United Audio will not
be completed as currently planned. Further, these projections involve future
operations and revenues and are therefore speculative. While Tweeter's
management believes that the projections are based on reasonable assumptions
concerning Douglas TV's operations and revenues following the completion of the
planned acquisition, such operations and revenues may differ significantly from
management's current expectations. These forward looking statements and
projections are subject to various risks and uncertainties, including risks
associated with the difficulty of integrating United Audio with the Tweeter
business model, the potential failure to achieve the beneficial synergies
expected to result from the acquisition, risks associated with management of
growth, the risks of economic downturns generally, and in Tweeter's industry
specifically, the risks associated with competitive pricing pressure and
seasonal fluctuations, the risks associated with the potential failure by
Tweeter to anticipate and react to changes in consumer demand and preferences,
Tweeter's dependence on key personnel, the risks associated with obtaining
financing for our business model, and those risks referred to in Tweeter's
Registration Statement on Form S-3 (SEC file number 333-94433) and Tweeter's
other filings with the Securities and Exchange Commission (copies of which may
be accessed through the SEC's web site at http:\\www.sec.gov), that could cause
actual future results and events to differ materially from those currently
anticipated. Readers are cautioned not to place undue reliance on these
forward-looking statements and financial projections.
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