Coinstar Posts Profits for Q4, May Buyout NCR Unit

Coinstar Inc. announced on Monday that its earnings in the fourth quarter of 2011 underwent a steady growth of over 200 per cent.

The company attributed this impressive growth to the ever expanding empire of its Redbox business. Coinstar further stated that it is pondering over the idea to pay as much as $100 million to purchase the DVD business assets of NCR Corp.

The NCR assets that Coinstar is eyeing to acquire include the whole DVD inventory, DVD kiosks as well as select few retail contracts. Apparently, both the companies are likely to ink a strategic supplier deal, designed to facilitate a perfect mechanism through which NCR will be selling off its services and products to Coinstar.

The deal, according to Coinstar, shall be closed some time during the third quarter - no specific date was mentioned though. Meanwhile, Coinstar is looking forward to pocket as much as $2.25 billion during the running year.

The company's Redbox DVD rental business has underwent some rather impressive growth over the last couple of years or so, however, analysts are doubtful about its long term growth opportunities.

Coinstar raised the price of the standard Redbox DVD rental by one-fifth last year in November - the first price increase introduced by the company in 8 years.

[Source: Businessweek]