Australian digital media company Destra Corporation has acquired Payless Entertainment, the budget audio and video content publisher and distribution company, for A$8.7 million ($6.5 million).

Australian digital media company Destra Corporation has acquired Payless Entertainment, the budget audio and video content publisher and distribution company, for A$8.7 million ($6.5 million).

Payless Entertainment, is expected to generate approximately A$2.5 million ($1.8 million) in earnings before interest and tax (EBIT) in the 2005-06 financial year, says Destra's Melbourne-based CEO Domenic Carosa.

Sydney-based Payless will license and distribute around five million CDs and DVDs this year through 400 retail outlets, including department and music retail chains and independent discount variety stores.

"Payless Entertainment's delivers physical support for our digital music and video communities," Carosa said in a statement issued today (June 30). "With this transaction, Destra is strengthening its position as a market leader in entertainment and digital media."

Payless Entertainment will continue to operate as an individual entity, says Carosa. But its board of directors -- including company founder Walter Lehne -- will be replaced by Rajon and Destra executives.

The digital media firm has been bullish on acquisitions in the last six months. The company has recently acquired audio and video companies Rajon Music and Rajon Vision (which is distributed by Sony BMG Music Entertainment Australia), sports video company Visual Entertainment Group and mobile ringtone business Poppy Chops.

Destra became Australia's first legal digital music download service when it launched in 2003. The service claims to have 1.3 million tracks licensed from most major labels.

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