Audiovox to buy Klipsch, we can't help but worry
It's true. Audiovox, a relative no-name in terms of consumer end products in the music industry, has just signed a non-binding term sheet to purchase all of the shares of Klipsch Group and its worldwide subsidiaries. We're told that the transaction is subject to a number of contingencies, "including satisfactory completion of due diligence, negotiation and signing of definitive agreements and requisite approvals," but we can't imagine anything popping up to stop the inevitable. No hard financial terms were revealed, and there's no estimated closing date for the deal. Oddly enough, Klipsch was here at CES unveiling a smattering of new products, and Audiovox was also here showing off far, far less interesting gear. We're hoping and praying that Audiovox allows Klipsch to continue working as its own entity rather than swallowing 'em whole and stifling innovation with corporate bureaucracy (similar to how Disney lets ESPN run its own show), but we'll be honest -- we're feeling a little uneasy about it. Klipsch is definitely one of our favorite audio companies around, and the last thing we'd want is to see a good company get hit with an undue amount of heavy-handed corporate control. Here's hoping for the best!
P.S. - If you missed our Klipsch headquarters walkthrough from a year ago, feel free to have a peek.
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Audiovox Signs Non-Binding Term Sheet
HAUPPAUGE, N.Y., Jan. 6, 2011 /PRNewswire/ -- Audiovox Corporation (Nasdaq: VOXX), announced today that it has recently signed a non-binding term sheet to purchase all of the shares of Klipsch Group Inc. and its worldwide subsidiaries ("Klipsch"). Klipsch is a leading, global provider of premium, high performance speakers sold through retail and installation channels. The transaction is subject to a number of contingencies, including satisfactory completion of due diligence, negotiation and signing of definitive agreements and requisite approvals.
Audiovox expects to finance this transaction through a combination of cash and a committed credit facility. Additional terms of the transaction were not disclosed. There can be no assurances that this, or any other transaction, will be completed or as to any terms that may be negotiated. Audiovox has retained Wells Fargo Securities LLC as its financial advisor in the proposed transaction.
Patrick Lavelle, President and CEO of Audiovox Corporation stated, "We have been actively pursuing acquisition opportunities that will grow the Company and improve our financial performance. The Klipsch brand is world-renowned and we believe Audiovox shareholders will benefit from the value of their unique market position, diversified customer base in home and professional channels, and their ongoing commitment to innovation."
About Audiovox
Audiovox (Nasdaq: VOXX) is a recognized leader in the marketing of automotive entertainment, vehicle security and remote start systems, consumer electronics products and consumer electronics accessories. The company is number one in mobile video and places in the top ten of almost every category that it sells. Among the lines marketed by Audiovox are its mobile electronics products including mobile video systems, auto sound systems including satellite radio, vehicle security and remote start systems; consumer electronics products such as MP3 players, digital camcorders, DVRs, Internet radios, clock radios, portable DVD players, multimedia products like digital picture frames and home and portable stereos; consumer electronics accessories such as indoor/outdoor antennas, connectivity products, headphones, speakers, wireless solutions, remote controls, power & surge protectors and media cleaning & storage devices; Energizer®-branded products for rechargeable batteries and battery packs for camcorders, cordless phones, digital cameras and DVD players, as well as for power supply systems, automatic voltage regulators and surge protectors. The company markets its products through an extensive distribution network that includes power retailers, 12-volt specialists, mass merchandisers and an OE sales group. The company markets products under the Audiovox, RCA, Jensen, Acoustic Research, Energizer, Advent, Code Alarm, TERK, Prestige and SURFACE brands. For additional information, visit our Web site at www.audiovox.com.
