Private equity firm STG to buy Avid Technology for $1.4 billion

Private equity firm Symphony Technology Group (STG) on Wednesday agreed to buy media editing software maker Avid Technology Inc for about $1.4 billion, including debt.

As part of the deal, Avid shareholders will receive $27.05 per share in cash, the company said in a statement, confirming an earlier Reuters report.

The deal represents a 32% premium to Avid’s closing share price on May 23, the day before Reuters reported the company was exploring a sale.

“After carefully evaluating a variety of options, the Board determined that this transaction is in the best interests of Avid and its stockholders,” Avid Chairman John Wallace said.

The transaction is expected to close in the fourth quarter of 2023. Sixth Street Partners and Silver Point provided debt financing for the deal, Avid said.

Founded in 1987, Avid provides editing software and hardware primarily to entertainment industries. Its products, which have been used in the production of blockbuster movies such as “Top Gun: Maverick” and “Avatar: The Way of Water,” include Media Composer, MediaCentral and AirSpeed.

An activist hedge fund and Avid’s largest shareholder, Impactive Capital LP, has representation on the Burlington, Massachusetts-based company’s board after cutting a deal with the company in 2019.

Palo Alto, California-based STG is a mid-market private equity firm focused on technology investments. Earlier this year, STG struck a deal to take Momentive Global Inc, the parent company of SurveyMonkey, private in a $1.5 billion deal.

STG currently manages about $10 billion of assets and has invested in more than 50 companies in the technology industry.

Goldman Sachs Group Inc served as financial adviser to Avid, while Sidley Austin LLP was the company’s legal counsel. Rothschild & Co served as financial adviser to STG, and Paul Hastings LLP provided legal counsel to the private equity firm. Reuters