Avid Technology has entered into a definitive agreement to acquire Midiman Inc., doing business as M-Audio. 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. The deal also includes earn-out provisions, which would be payable to M-Audio''s equity holders based on achieving certain financial milestones that were undisclosed. Under the terms of the agreement, M-Audio will become a business unit of Avid''s Digidesign audio division and will market its line of computer audio peripherals, PCI sound cards, keyboard controllers and control surfaces, microphones, speakers, and distributed software and proprietary sound libraries. M-Audio founder and CEO, Tim Ryan, will continue to oversee M-Audio''s operations as the general manager of Digidesign''s M-Audio business unit.
"With this acquisition," explained Avid''s president and CEO, David Krall, "we''re bolstering our investment in the home studio market segment, the fastest growing portion of our audio business, where we achieved roughly 40-percent year-over-year growth in Q2 of 2004."
Avid provided the following preliminary guidance for 2005 incorporating the expected results of the M-Audio acquisition. The acquisition is expected to add to Avid''s top-line in 2005, taking the company''s revenues to more than $700 million.
Digidesign general manager and Avid VP Dave Lebolt commented, "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."
M-Audio has approximately 200 employees in the U.S. and Europe. In recent years, the privately held company has created computer-based audio products for high-quality home recording. These products include USB and FireWire audio interfaces, USB MIDI keyboards and controllers, PCI sound cards, studio reference monitors, microphones, microphone preamps and sound production libraries; the company also distributes third-party music production software and audio plug-ins.
According to Ryan, "Customers can look forward to continued innovation from M-Audio as we pursue the opportunities that will result from this combination."
The boards of directors of both Avid and M-Audio have unanimously approved the definitive agreement. The acquisition has received Hart-Scott-Rodino antitrust clearance and is expected to close before the end of August after the satisfaction of certain closing conditions.
For more information on Avid, Digidesign and M-Audio, visit www.avid.com, www.digidesign.com, and www.m-audio.com, respectively.