Avid to Be Acquired by Private Equity Firm for $1.4 Billion

Industry Insights

by Alex HohenthanerAugust 14^th, 2023

Avid Technology – the developer of industry-standard tools such as Media Composer and Pro Tools – has recently announced that it has entered into a definitive agreement with an affiliate of private equity firm STG to be acquired for a sum of US$ 1.4 billion.

Both Media Composer and Pro Tools have long been standard tools in the post-production industry – competing with other offers such as Premiere Pro, Final Cut, Ableton Live, and DaVinci Resolve. The company also offers solutions for broadcasting, asset management, and storage.

A recent switch to a subscription model was not very popular, but according to some analysts that was already a sign of the company wanting to attract potential investors.

Since our founding over 30 years ago, Avid has delivered technology that enables individuals and enterprises who create media for a living to make, manage and monetize today’s most celebrated video and audio content across the globe. We are pleased to announce this transaction with STG, who share our conviction and excitement in delivering innovative technology solutions to address our customers’ creative and business needs. 
STG’s expertise in the technology sector and significant financial and strategic resources will help accelerate the achievement of our strategic vision, building on the momentum of our successful transformation achieved over the past several years. This transaction represents the start of an exciting new chapter for Avid, our customers, our partners and our team members and is a testament to the importance of Avid and our solutions in powering the media and entertainment industry.

Jeff Rosica, Avid’s Chief Executive Officer and President

Further details and the future of the company

Under the agreement, anyone holding shares in Avid will receive $27.05 per share, representing a premium of 32.1% on the company’s share price in May 2023. The deal was unanimously approved by the Board of Directors at Avid and is expected to be closed by the end of the year.

What happens afterward is still unclear. On one hand, the company will not be as subjected to the ups and downs of the stock market as it used to be – the share price went through quite a lot of value fluctuations in recent years. On the other hand, private investors often put pressure on to make the company more profitable. Some analysts speculate that parts could be sold off to competitors, but it is way too early to tell if this will happen.

For more information, please visit Avid’s website here.

What do you believe will happen to Avid? How do you think this switch can affect you as a video or sound editor? Let us know in the comments below!