Avid Technology is acquiring rival video-editing maker Pinnacle Systems in a $462 million deal.
The purchase, first reported in depth by Digit, values Pinnacle at a premium of 30 per cent above its market value, and is based on a stock and cash deal. Under the terms of the agreement, Avid says it will issue 0.0869 shares of Avid and $1 in cash for each Pinnacle share. Avid says it expects to issue around 6.2 million shares – around 15 per cent of its common stock.
The deal, which is subject to shareholder and regulatory approval, is expected to close in the second or third quarter of 2005, says Avid.
Avid president and CEO David Krall said: “We see this acquisition as the next logical step in our long-term strategy."