RPT-UPDATE 2-Rovi to buy Sonic for $720 mln, widens digital offering

* Offers $14.17/shr in cash and stock: premium of 26 pct

* Rovi sees deal adding 5-10 cents/shr to earnings in 2011

* Ups 2010 adjusted EPS view to $2.08-$2.12

* Raises 2010 revenue outlook to $538-$542 mln

(Recasts; adds deal detail, Rovi 2010 outlook)
(Repeats to fix formatting)

NEW YORK/BANGALORE, Dec 23 (BestGrowthStock) – Rovi Corp
will pay $720 million in cash and stock to buy Sonic Solutions
, which owns the popular digital video player software
DivX, in a bid to broaden its footprint across the digital
entertainment space.

The Rovi deal follows Sonic’s purchase of DivX Inc in June
for $323 million, which boosted Sonic’s Internet-based video
delivery products.

The proposed combination of Rovi and Sonic will be better
able to help Hollywood studio clients sell content in a
fast-growing digital entertainment market, the companies said.

Consumers will be able to more easily find the content
they want to watch, which may make them more willing to pay
higher prices.

Rovi, which provides entertainment data, content
protection and content networking technology, will offer
$14.17 per share to Sonic shareholders, representing a premium
of 26 percent over Sonic’s Wednesday close of $11.22 per share.

Under the agreement, Sonic shareholders may elect to
receive either $14.00 or 0.2489 shares of Rovi common stock
for each share. Cash consideration will constitute 55 percent
of the total value of the offer, while rest will be in stock.

ROVI RAISES OUTLOOK

Rovi sees the deal, which is expected to close in the
first half of 2011, adding 5-10 cents per share to its
adjusted earnings and to generate more than $15 million in
savings in 2011.

Rovi also raised its outlook for fiscal 2010, and now
expects revenue of $538-$542 million, and adjusted earnings of
$2.08-$2.12 per share. Analysts were expecting earnings of
$2.08 a share on revenue of $540.5 million for 2010, according
to Thomson Reuters I/B/E/S.

Sonic was advised by William Blair & Company, LLC.
JPMorgan acted as financial adviser to the Rovi board.

Rovi stock closed at $58.3 Wednesday on Nasdaq.
(Reporting by Nick Zieminski and Abhinav Sharma; Editing by
Lincoln Feast and Muralikumar Anantharaman)

RPT-UPDATE 2-Rovi to buy Sonic for $720 mln, widens digital offering