LONDON, UK: Focusrite plc (AIM: TUNE) announced the acquisition of Sonnox Limited, a leading designer of audio processing software plug-ins for professional audio engineers.
The total cash consideration to be paid for Sonnox is £9.1 million, which has approximately £2.1 million of cash, and will be funded from existing facilities with HSBC and NatWest. Following the acquisition, the enlarged Group will have net debt of approximately £13 million.
For the year ended 31 March 2022, Sonnox’s unaudited revenue was £2.4 million with profit before tax of £0.9 million, and gross assets of £3 million. The Board expects the acquisition to be earnings enhancing in the current financial year, excluding non-underlying transaction costs and amortisation of acquired intangibles.
Based near Oxford, Sonnox is a well-established and acclaimed brand in the global audio industry. Its range of innovative, high quality, award-winning processing software is used in a wide range of audio applications including mixing for music production, live sound, broadcast, TV & Film, and even scientific and forensics projects.
The business is wholly owned by Rod Densham, who was one of the co-founders of the “Sony Oxford” start-up that designed the legendary Oxford OXF-R3 for Sony Corporation.
The console was installed in major recording studios worldwide and became widely accepted as the first ‘musical’ sounding digital console.
As Digital Audio Workstations running on computers became the standard medium for audio to be recorded and edited, many hardware companies, including Sony, began porting their hardware signal processing to a “plug-in” format that could be utilized in these workstations.
Rod led the team at Sony that ported their audio digital signal processing algorithms into plug-ins, which he then acquired from Sony in 2007 to form Sonnox.
Since then, they have continued to build on the Sony Oxford heritage together with adding a range of Toolbox plug-ins designed for speed and simplicity. Rod and his entire team of 16 will stay with the business post acquisition.
Today Sonnox’s software is sold through an established sales channel of more than 100 dealers worldwide, together with its own e-commerce site. Sales are particularly strong in the USA, Japan, and the UK. Sonnox has protected its intellectual property through software copyrights, international trademarks and patents.
The acquisition adds audio software to the Group’s growing portfolio, specifically complementing our existing offerings in the recording space, and is aligned with our previously communicated strategic aims of growing the core customer base, expanding into new markets, and increasing lifetime value for our customers.
Tim Carroll, Chief Executive Officer, said: “This is our first acquisition in the audio software market, and it is an absolute pleasure to welcome Rod and his entire team to the Focusrite Group. Sonnox’s products are globally recognised as best in class, making them a natural fit in our stable, and we are all excited about the opportunities and possibilities that lie ahead with the collective expertise of our combined sales and R&D teams.”
Rod Densham, Founder and Managing Director of Sonnox added: “Sonnox is in a strong financial position, expanding our customer base and consistently delivering profit.
We believe that by joining Focusrite with their scale, industry expertise and range of premium brands, we can continue to grow, and deliver innovation and excellence to audio hobbyists and professionals alike. Focusrite have a proven track record of achieving this in our industry, and we are very excited to become part of their Group.”