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  #11  
Old 03-19-2022, 12:35 AM
SCAudiophile SCAudiophile is offline
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You are right, thanks for the correction.


From investors.com:

"Finally, there's a huge difference in valuation between the buyer and seller, he said. Masimo's market cap was roughly $12.6 billion early Wednesday. It's spending $1.025 billion to acquire Sound United. In 2021, Masimo generated $1.24 billion in sales. Sound United brought in $900 million."

SU recorded $900M revenue in 2021

"The deal marries medical technology player*Masimo*(MASI) and privately held Sound United, a manufacturer of consumer audio devices like earphones and speakers. Masimo argued the $1.025 billion buyout gives it access to an established distribution channel with major retailers and a potential to cross-sell its products.

But investors and analysts weren't impressed."

"This is the first time we have seen a medtech company move into non-health consumer products with a large acquisition," he said.

Further, the transaction will be dilutive to revenue growth and margins, but accretive to earnings. The company also doesn't expect any cost synergies,..."
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  #12  
Old 03-19-2022, 09:22 AM
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Thanks, great info. Sound United is much larger than I thought. My $1 Ben industry number must be without home theater. Dunno.

Masimo is running in the 20% range on gross profit and SU is dilutive to that, so I’m guessing maybe 15% GP. That would make the deal 6x GP which isn’t overpriced.
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  #13  
Old 03-19-2022, 09:27 AM
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Quote:
Originally Posted by W9TR View Post
Those numbers are for Masimo, Q4.
Sound United (is) was privately held so we don’t know how it performed.
Apart from headphones, the high end audio business is about $1Bn/yr total, all players, all in.
My view is that Marantz and Denon are Hi-Fi, not Hi-end ever since Marantz dropped their refernce separates line a decade ago, and Denon hasn't been Hi-End since Fairytale days.

Nevertheless, I agree this deal is a real head shaker. In the long run has the potential to be really bad for the D&M brands. Hopefully it won't turn out like the Alpine/Luxman acquisition of the mid 80's.
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Last edited by FreddieFerric; 03-19-2022 at 09:31 AM.
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  #14  
Old 03-19-2022, 01:03 PM
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Quote:
Originally Posted by SCAudiophile View Post
You are right, thanks for the correction.


From investors.com:

"Finally, there's a huge difference in valuation between the buyer and seller, he said. Masimo's market cap was roughly $12.6 billion early Wednesday. It's spending $1.025 billion to acquire Sound United. In 2021, Masimo generated $1.24 billion in sales. Sound United brought in $900 million."

SU recorded $900M revenue in 2021

"The deal marries medical technology player*Masimo*(MASI) and privately held Sound United, a manufacturer of consumer audio devices like earphones and speakers. Masimo argued the $1.025 billion buyout gives it access to an established distribution channel with major retailers and a potential to cross-sell its products.

But investors and analysts weren't impressed."

"This is the first time we have seen a medtech company move into non-health consumer products with a large acquisition," he said.

Further, the transaction will be dilutive to revenue growth and margins, but accretive to earnings. The company also doesn't expect any cost synergies,..."
"the $1.025 billion buyout gives it access to an established distribution channel with major retailers and a potential to cross-sell its products." -> so that's the bet, thanks for sharing this
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  #15  
Old 12-07-2022, 07:23 PM
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Apparently Masimo's purchase of Sound United has not gone down well with shareholders as the company has now trimmed 5 billion in value post acquisition.

It seems a shareholder lawsuit has been filed over this ill-conceived purchase. Looks like the legal wrangling will be protracted. More on the story is found in the "Industry Update" section of the January, '23 Stereophile.
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  #16  
Old 12-08-2022, 12:23 AM
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This reminds me of when B&W was sold to Eva Automation. Not good for Sound United!
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  #17  
Old 12-08-2022, 01:29 PM
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"bringing Sound United's premium technologies into the hospital to advance our hospital automation connectivity and cloud-based technologies".
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  #18  
Old 12-08-2022, 04:13 PM
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Quote:
Originally Posted by piolaxo View Post
"bringing Sound United's premium technologies into the hospital to advance our hospital automation connectivity and cloud-based technologies".
Nurse: "Doctor which catheter do you want to use on this patient; the Denon or Marantz?

Doctor: "We're going with the Marantz catheter for him and make sure you feed good volume of "Slow Burn" through it while his bladder drains.

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  #19  
Old 12-08-2022, 06:55 PM
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Quote:
Originally Posted by FreddieFerric View Post
Nurse: "Doctor which catheter do you want to use on this patient; the Denon or Marantz?

Doctor: "We're going with the Marantz catheter for him and make sure you feed good volume of "Slow Burn" through it while his bladder drains.

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  #20  
Old 12-09-2022, 12:51 AM
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Sounds like the execs at Sound United just cashed out.
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