Hauppauge, N.Y. - Audiovox and Klipsch Group entered into a definitive agreement in which Audiovox will buy Klipsch for $166 million. The deal is expected to close in 30 days.
Klipsch will become a wholly owned subsidiary of Audiovox, will be run as a stand-alone operation in Indianapolis, and will continue to be led by Klipsch's current management team, Audiovox said.
Though Klipsch will operate as a stand-alone company, said Audiovox president/ CEO Patrick Lavelle, "we see many opportunities to leverage distribution, global brand development, and brand expansion in areas such as OEM automotive and professional audio."
Klipsch also "provides an outstanding new distribution channel for our company to reach the home and commercial installation markets," Lavelle said.
Audiovox expects to finance the acquisition with a combination of existing Audiovox cash and a new asset-based revolving credit facility that will also be used for operating capital. Once the deal closes,
Audiovox also expects to have money left over under the credit facility for general corporate purposes.
On a pro-forma basis, for the 12 months ending Nov. 30, 2010, the combined companies' revenues were about $742.2 million, compared with $573.1 million for Audiovox as a standalone company, Audiovox said.
Lavelle called Klispch Group "the preeminent audio brand for residential, professional and personal listening use." He said the company has "a strong and stable base of retail, e-commerce, commercial distribution, and professional installation business partners in North America, Europe and around the world."