Avid Finally Found A Buyer - STG

US And they paid $1.4bn      10/08/23

Avid Finally Found A Buyer - STG


Mergers and acquisitions are not usually the standard fare here, but this is a biggie. AVID Technology, the folks behind Pro Tools and Media Composer - video editing, have been looking for a buyer in recent months and there have been plenty of rumours and speculation as to who might be interested.

STG are a private equity firm with a range of what seems like unrelated investments aside from data and analytics software. They have just announced the purchase -  reportedly paying $1.4bn dollars with AVID shareholders each getting a 32% premium of $27.05 per share. This is roughly 200million above the market capitalization value :

Market capitalization refers to how much a company is worth as determined by the stock market. It is defined as the total market value of all outstanding shares.

via investopedia.com

The deal is expected to go through later this year and means that AVID will become a wholly privately owned company.
AVID were one of the first in music and media tech to float and become beholden to the markets. It represented an enormous sea change in the way the company was run and motivated, not something that businesses in the creative arts were known for. In came the business consultants and policy of 90 days payment terms and more glossy, corporate approach. Some of our tradeshow interviews in recent years have been more like talking to highly media trained political figures...

While some of the end users of ProTools weren't entirely comfortable with this,  and lets face it, creatives despite their free-thinking and imagination are quite resistant to change, it certainly seems to have worked in terms of revenue. Over COVID and in recent years, the profits have been stacking up.

However, the jewel in the crown would appear to be ProTools , with Media Composer - once the gold standard in TV production video editing, has gradually become superseded by newer options - Final Cut and more recently Davinci Resolve. Many have complained that the code base has been left behind and not updated.

It remains to be seen as to whether under STG's stewardship, the ProTools or indeed Media Composer eco system will thrive and continue to develop competitively, or if there is some other agenda we don't know of. 

https://www.avid.com/


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