D&M Holdings Inc. to Acquire Boston Acoustics, Inc.
June 08 2005 - 8:09PM
PR Newswire (US)
D&M Holdings Inc. to Acquire Boston Acoustics, Inc. --
Acquisition Adds a Premium Loudspeaker Brand to the D&M
Portfolio & Foothold in the Audio Automotive System Business --
TOKYO and PEABODY, Mass., June 8 /PRNewswire-FirstCall/ -- D&M
Holdings Inc. (TSE II: 6735) and Boston Acoustics, Inc.
(NASDAQ:BOSA), the premier manufacturer of high-performance audio
systems, announced today the signing of a definitive merger
agreement for D&M Holdings to acquire Boston Acoustics through
its subsidiary D&M Holdings US Inc. D&M Holdings is the
owner of Denon, Marantz, McIntosh Laboratory and the D&M
Professional, ReplayTV(R), Rio(R) and Escient(R) brands. D&M
Holdings will acquire Boston Acoustics for $17.50 per share in cash
for a total of approximately $76.0 million. This transaction is
expected to be immediately accretive to D&M's earnings upon
closing. Boston Acoustics designs, manufactures, and markets high
performance audio products with its signature Boston Sound(TM). Its
product categories are Home Speakers and Audio Systems, Speakers
and Electronics for the Custom Installation market, All Weather
Outdoor Speakers, Speakers and Amplifiers for the Automotive
After-market and Systems for the Automotive OEM market. The
company's audio business includes tabletop models Recepter
Radio(R), Recepter Radio(R) HD, MicroSystem CD and Home Theater
Systems. Boston Acoustics is the market leader for
in-wall/in-ceiling speaker systems, and it supplies Boston
Acoustics-branded speakers for the Chrysler 300, which is the 2005
Motor Trend Car of the Year, the Jeep (R) Grand Cherokee, the Dodge
Magnum and the Dodge Charger. Boston Acoustics also owns the Snell
brand of super premium speakers. The acquisition of Boston
Acoustics provides D&M with a premium speaker line and the
ability to deliver customers a complete home entertainment
solution. D&M branded products include premium A/V receivers,
amplifiers and CD players; DVD players, DLP projectors and display
plasma monitors; and digital media management systems. The
acquisition also gives D&M a strong foothold in the automotive
OEM business along with the ability to leverage all five premium
brands -- Denon, Marantz, McIntosh, Boston Acoustics and Snell --
in that business. D&M is planning to operate Boston Acoustics
as a distinct brand but with the benefit of D&M's sales,
technology and cost synergies by leveraging product distribution
channels, product development and back-office integration. "Andy
Kotsatos, co-founder and chairman of Boston Acoustics, has created
an award-winning, innovative company with a strong design and
engineering team," said Tatsuo Kabumoto, chief executive officer of
D&M Holdings. "We will now build upon the success of this
outstanding brand. We see significant opportunities to leverage
marketing and sales activities. We also expect to find multi-brand
opportunities in the automotive OEM business." Said Andy Kotsatos:
"The benefits to us of joining D&M are enormous. They provide
us with state-of-the-art technology and experience in home
entertainment products. They will be able to help us grow our brand
outside North America. And they will provide us with marketing
know-how to substantially increase our table radio and music system
business. We are delighted to be part of the company's portfolio."
The transaction, which has been approved by the Board of Directors
of Boston Acoustics, is subject to the approval of the company's
shareholders and the satisfaction of other customary closing
conditions, including the receipt of required financing. Mr.
Kotsatos, his wife and the Kotsatos family trusts and Daeg Partners
LP have each agreed to vote their shares, representing
approximately 33.2% and 4.8% of the voting stock of Boston
Acoustics, respectively, in favor of the transaction. The
transaction is expected to close by August 31, 2005. Boston
Meridian, an investment bank that specializes in providing merger
and acquisition services and raising private capital for growth
companies, served as financial advisor and Nixon Peabody LLP served
as legal advisor to Boston Acoustics in the transaction. Simpson
Thacher & Bartlett LLP served as legal advisor to D&M
Holdings. Boston Acoustics, Inc. was founded in 1979 and is located
in Peabody, Massachusetts, U.S.A. Fiscal year 2004 revenue is $52.6
million and revenue for the nine-month period of its fiscal year
2005 ending December 25, 2004 is $42.8 million. About D&M
Holdings Inc. D&M Holdings Inc. (TSE II: 6735) is based in
Tokyo and owns the Denon, Marantz, McIntosh Laboratory, D&M
Professional, ReplayTV(R), Rio(R) and Escient(R) brands. Denon,
Marantz, McIntosh and D&M Professional are global industry
leaders in the specialist home theater, audio/video consumer
electronics or professional audio markets, with a strong and
long-standing heritage of manufacturing and marketing
high-performance audio and video components. The ReplayTV, Rio and
Escient brands represent award-winning technologies in digital home
entertainment. Additional information is available at
http://www.dm-holdings.com/ . About Boston Acoustics Founded in
1979, Boston Acoustics, Inc. (NASDAQ:BOSA) designs, manufactures,
and markets high performance audio systems for use in home music
and audio-video systems, after-market and OEM automotive systems,
and custom built-in audio systems. Highly regarded for creating The
Boston Sound(TM), the company is renowned for delivering superior,
competitively priced products emphasizing performance, consistency
and value. For further information, visit the company's Web site at
http://www.bostonacoustics.com/ . FORWARD-LOOKING STATEMENTS This
press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Such statements include, but are not limited to, statements about
the benefits of the acquisition of Boston Acoustics, Inc. by
D&M Holdings Inc. and D&M Holdings' plans, objectives,
expectations and intentions and other statements that are not
historical facts. Such statements are based upon the current belief
and expectations of D&M Holdings' and Boston Acoustics'
management and are subject to significant risks and uncertainties.
Actual results may differ from those set forth in the
forward-looking statements. The following factors, among others,
could cause actual results to differ from those set forth in the
forward-looking statements: the risk that the required financing
will not be obtained; the ability to obtain governmental approvals
of the transaction on the proposed terms and schedule; the failure
of Boston Acoustics' shareholders to approve the transaction; the
risk that Boston Acoustics will not be integrated successfully into
D&M Holdings' global operations; failure to quickly realize
synergies and cost-savings from the transaction as a result of
technical, logistical, competitive and other factors; disruption
from the transaction making it more difficult to maintain
relationships with clients, employees or suppliers; changes in
consumer confidence, tastes, preferences and spending; changes in
interest rates; competitive conditions in the consumer electronics
industry; the impact of seasonal buying patterns, which are
difficult to forecast with certainty; and general economic
conditions and normal business uncertainty. These forward-looking
statements speak only as of the time first made, and no undertaking
has been made to update or revise them as more information becomes
available. Boston Acoustics intends to file a proxy statement with
the Securities and Exchange Commission in connection with the
merger transaction. Investors and security holders are urged to
read this filing when it becomes available because it will contain
important information about the merger transaction. Investors and
security holders may obtain a free copy of the proxy statement
(when it is available) and other documents filed with the SEC by
Boston Acoustics at the SEC's Internet site ( http://www.sec.gov/
). Copies of the proxy statement and the filings with the SEC
incorporated by reference in the proxy statement can also be
obtained, without charge, by directing a request to Boston
Acoustics, 300 Jubilee Drive, Peabody, Massachusetts, 01960,
Attention: Investor Relations. The directors and executive officers
of Boston Acoustics and D&M Holdings may be deemed to be
participants in the solicitation of proxies in respect of the
proposed transaction. Information regarding the special interests
of these directors and executive officers in the merger transaction
will be included in the proxy statement. Additional information
regarding the directors and executive officers of Boston Acoustics
is also included in Boston Acoustics' proxy statement for its 2004
Annual Meeting of Stockholders, which was filed with the SEC on
July 26, 2004. This proxy statement is available free of charge at
the SEC's Internet site and Investor Relations at Boston Acoustics
as described above. DATASOURCE: D&M Holdings Inc.; Boston
Acoustics, Inc. CONTACT: Naoyuki Honmura of D&M Holdings Inc.,
+81 42 748 7700, Adam Weissman of Dobbin-Bolgla Associates for
D&M Holdings in the US, +1-212-388-1400, +1-917-693-3298
(cell), , Moses Gabbay of Boston Acoustics, Inc., +1-978-538-5000,
Web site: http://www.dm-holdings.com/
http://www.bostonacoustics.com/
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