Parsippany, N.J. – Mass-market electronics supplier Emerson Radio has formed a joint venture with high-end audio supplier Adcom to make and market home and office A/V equipment.
The joint venture, called Advanced Sound and Image (ASI), puts Emerson’s resources behind the Adcom brand. It will operate out of Scottsdale, Ariz., but be headquartered in Emerson’s Parsippany offices.
Under the terms of the deal, Emerson got a controlling interest in ASI, and in exchange, Emerson made a “nominal upfront cash investment” in ASI and made a secured line of credit available to the joint venture. Adcom got a non-controlling interest and a “nominal cash consideration” in return for providing ASI with assets, including an “exclusive worldwide royalty-free license to make, sell and distribute products incorporating Adcom’s intellectual property, including its trademarks.”
The terms were outlined in an agreement in principle announced in early January.
“There’s tremendous potential in combining Adcom’s products with the resources of Emerson,” said Adcom managing director Dan Donnelly.
John Spielberger, Emerson’s president of North American operations, said the deal will create “numerous growth opportunities for ASI because of both companies’ knowledge of the electronics marketplace, “Adcom’s sophisticated products and engineering/development expertise and Emerson’s access to world class manufacturing and distribution capabilities.”
The audio brand, founded in the 1970s as a high-end high-value line, was purchased in early 2002 from its founders by Klein Technology Group, whose principals were industry veterans who included current Adcom managing director Dan Donnelly. The group built up the brand’s multichannel home theater presence to supplement its two-channel presence. Adcom currently offers audio components, a DVD player and surge suppressor/line conditioners.
The original Adcom owners currently market the KEF America brand.