Ker-ching! That's $80 million please - have a nice weekend 13/08/04We heard something was afoot a little while back, but being the goody two shoes we are, couldn't possibly comment until it was official (that and the fear of very expensive law suits.)
But now it seems it's true, the official news has just come in hot off the wires that Avid Technology, Inc. (NASDAQ: AVID) today announced that it has entered into a definitive agreement to acquire Midiman, Inc., doing business as M-Audio – a leading provider of digital audio and MIDI solutions for electronic musicians and audio professionals. At closing, Avid will pay approximately $80 million in cash, issue approximately 2 million shares of Avid common stock, and assume all outstanding M-Audio stock options.
Under the terms of the agreement, M-Audio will become a business unit of Avid’s Digidesign audio division and market its line of computer audio peripherals, PCI sound cards, keyboard controllers and control surfaces, microphones, speakers, and distributed software and proprietary sound libraries alongside Digidesign’s award-winning digital audio workstations for the professional and home/hobbyist markets.
A bold move this, Avid are well known in the video world as the de-facto standard for professional video editing plus they also own Digidesign, makers of the ubiquitous Pro-Tools system that many professional audio recordists favour.
This latest news should make Avid/Digidesign an even bigger player in the pro-sumer hobbyist market that Apple have been carving a sizeable niche into with their desktop video editing software Final Cut Pro, not to mention the market chunk they have grabbed since their purchase of Emagic and Logic Pro .This news comes at a time when Apple are working towards the release of a major update to their Logic Pro software, including, we understand an overhaul of the audio engine....
It's therefore inevitable that there will be a tussle over this common ground between these two giant companies - result being? We get more for our money.
Indeed, this quote from David Krall, Avis CEO seems to support this:
“With this acquisition, we’re bolstering our investment in the home studio market segment, the fastest growing portion of our audio business, where we achieved roughly 40% year-over-year growth in Q2 of 2004. We believe the addition of M-Audio to the Avid family will put us in a position to provide a complete set of creative tools to the market, from entry-level music hobbyists with home studios to facility owners, recording artists, audio engineers, and film sound professionals.”
Digidesign general manager and Avid vice president Dave Lebolt also commented, “The entry-level audio market offers attractive growth opportunities, and both Digidesign and M-Audio have demonstrated solid successes in this area. As a combined entity, Digidesign and M-Audio can tap into subsegments of this market that we would not otherwise reach as strongly on our own. At the same time, Digidesign will continue to focus in the professional audio space, including the expansion we’ve targeted in the mixing and live sound markets, while M-Audio will further extend its reach to an even wider consumer base. As a result, Avid will have a range of new capabilities to address the audio business, and customers will have a broader set of audio options to meet their increasingly diverse needs.”
“As we move forward, we plan to blend Digidesign’s expertise in the professional arena with our proven track record for engineering advanced technology into low-cost, high-quality products. Customers can look forward to continued innovation from M-Audio as we pursue the opportunities that will result from this combination.” said M-Audio founder and CEO Tim Ryan.
Conference Call - listen in…
A conference call to discuss the M-Audio acquisition will be held on Friday, August 13, at 8:00 a.m. EDT. The call will be open to the public. The conference call can be accessed from any U.S. or international location by dialing (719) 457-2649 and referencing confirmation code 994706. The call and subsequent replay will also be available on Avid’s Web site. To listen via this alternative, go to the Investors page under the Company menu at www.avid.com for complete details 10-15 minutes prior to the start of the conference call.