Burlington, MA (July 2, 2012)—Avid, the audio company behind Pro Tools, Venue live sound consoles and more, is divesting its consumer businesses, selling its consumer audio products, including its M-Audio line, to inMusic, the parent company of Akai Professional, Alesis and Numark. Avid’s consumer video editing line is being purchased by Corel Corporation. Avid will also reduce its permanent workforce by 20 percent.
The consumer audio products being sold to inMusic include M-Audio brand keyboards, controllers, interfaces, speakers and digital DJ equipment and other product lines. Avid will continue to develop and sell its Pro Tools line of software and hardware, as well as associated I/O devices including Mbox and Fast Track.
Separately, the company’s consumer video editing line being sold to Corel Corporation, a consumer software company headquartered in Ottawa, Canada, include, Avid Studio, Pinnacle Studio, and the Avid Studio App for the Apple iPad, as well as other legacy video capture products.
The divested product lines contributed approximately $91 million of Avid’s 2011 revenue of $677 million. As part of the transactions, certain employees of Avid will transfer to each acquiring company. Avid estimates that the proceeds from these transactions will be approximately $17 million, subject to closing inventory adjustment, with a portion held in escrow. Both transactions are expected to close today, July 2, 2012.
Avid also plans to reduce the number of its employees as it streamlines operations, with approximately 20 percent of its permanent employee base impacted by the divestitures and headcount reduction plans. The company currently expects to incur a restructuring charge of approximately $19 to $23 million related to these actions and other associated measures. The company’s cash balance on March 31, 2012 was $49.7 million. Avid expects proceeds from the sales to offset most of the restructuring charges paid in 2012.
“The changes we are announcing today make Avid a more focused and agile company,” said Gary Greenfield, CEO of Avid. “By streamlining and simplifying operations, we expect to deliver improved financial performance and partner more closely with our enterprise and professional customers. Our objective remains to provide these customers with the innovative solutions that allow them to create the most listened to, most watched and most loved media in the world. I’m excited about our future prospects.”