Personal equity’s enjoy of songs tech proceeds, as STG acquires Professional Equipment maker Avid for $1.4bn

Ora Sawyers 3 months ago

A pair of months in the past, we wrote about personal equity’s fascination in the tunes technologies house, and looked at a couple of the music tech corporations backed by well-funded PE firms.

Now, a single of the world’s most outstanding makers of experienced audio-building software package is currently being obtained in a offer value $1.4 billion.

Avid Technological know-how, the developer of video clip and audio editing applications, such as the properly-recognized Pro Resources DAW, has agreed to be acquired by personal equity firm Symphony Engineering Team (STG) in an all-dollars transaction worth all over USD $1.4 billion, like personal debt.

The offer is expected to close throughout Q4 2023, topic to Avid stockholder approval and regulatory approvals, Avid and STG claimed in a assertion issued August 9.

Beneath the deal, shareholders of Burlington, Mass.-headquartered Avid will acquire USD $27.05 in cash for each individual unit of Avid’s popular inventory, representing a 32.1% premium over the company’s share cost on May well 23, the previous investing day right before Reuters noted that the organization was exploring a sale.

The company’s shares jumped 18% that day on the information, possessing previously dropped precipitously adhering to a disappointing Q1 earnings report.

As not too long ago as the 1st 7 days of August, numerous traders were vying to order Avid, among the them Francisco Companions, the non-public equity agency that obtained Berlin-based mostly new music tech business Indigenous Instruments in 2021, and Kobalt Tunes Group in 2022.

Established in 1987, Avid has come to be a distinguished service provider of video and audio application and machines. In accordance to the company’s internet site, every single file nominated for History of the 12 months at the 2022 Grammys was produced with the aid of Avid Pro Resources, and all the movies nominated for Ideal Modifying and Finest Photograph at the 2022 Academy Awards ended up edited making use of Avid Media Composer.

The Professional Equipment maker also operates a Do-it-yourself audio distribution services known as AvidPlay, which distributes new music to around 150 significant platforms like Spotify, Apple New music, Amazon Music, and Tidal.

Menlo Park, Calif.-headquartered STG is a mid-sector non-public equity business established by billionaire investor Romesh Wadhwani in 2002. Among its acquisitions are McGraw-Hill Development (2014), RSA Safety (2020) and McAfee Enterprise (2021).

STG’s acquisition of Avid has been unanimously approved by the company’s board. On completion of the acquisition, Avid will grow to be a privately held corporation and will be delisted from the NASDAQ.

Goldman Sachs & Co. LLC served as advisor to Avid in the sale system, and Sidley Austin LLP served as legal counsel. On STG’s facet, Rothschild & Co. served as economical advisor, and Paul Hastings LLP served as legal counsel. Sixth Road Partners and Silver Position are providing credit card debt financing in aid of the transaction.

“Since our founding above 30 many years back, Avid has shipped technological know-how that permits individuals and enterprises who produce media for a residing to make, handle and monetize today’s most celebrated video clip and audio content throughout the world,” Avid President and CEO Jeff Rosica said in a statement.

“We are pleased to announce this transaction with STG, who share our conviction and pleasure in providing revolutionary engineering solutions to handle our customers’ resourceful and organization demands. STG’s knowledge in the technological know-how sector and significant monetary and strategic resources will assist speed up the accomplishment of our strategic vision, building on the momentum of our profitable transformation accomplished about the earlier quite a few a long time.

“This transaction represents the commence of an remarkable new chapter for Avid, our clients, our partners and our crew associates and is a testomony to the value of Avid and our options in powering the media and leisure business.”

“STG’s experience in the technological innovation sector and significant fiscal and strategic sources will assistance accelerate the accomplishment of our strategic vision, constructing on the momentum of our successful transformation attained in excess of the past various a long time.”

Jeff Rosica, Avid

John P. Wallace, Chairman of the Avid Board of Administrators, added: “This transaction is the consequence of a complete overview of strategic alternate options for Avid. On closing, this transaction will deliver rapid, substantial and specified worth to our stockholders. Right after cautiously evaluating a wide range of selections, the Board established that this transaction is in the greatest passions of Avid and its stockholders.”

STG Running Spouse William Chisholm explained the non-public fairness business, “has admired Avid’s heritage as a class creator and pioneer in the media and leisure software program current market for lots of decades.”

He additional: “We are enthusiastic to husband or wife with Jeff and the administration workforce to establish on the company’s background of providing differentiated and ground breaking material development and administration software program methods. We seem ahead to leveraging our encounter as application buyers to accelerate Avid’s advancement trajectory with a deep aim on technological innovation and by delivering improved worth for Avid’s customers.”Tunes Company All over the world

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