ORLANDO, Fla., July 6, 2020 /PRNewswire/ -- VOXX
International Corporation (NASDAQ: VOXX), a leading manufacturer
and distributor of automotive and consumer technologies for the
global markets, is pleased to announce it has successfully acquired
the aftermarket vehicle remote start and security systems ("RSS")
and connected car solutions ("CC") businesses of Directed, LLC and
Directed Electronics Canada Inc. ("Directed"). This transaction was
completed on July 2, 2020, via an
Asset Purchase Agreement ("Agreement"). VOXX DEI LLC, a newly
formed 75% owned subsidiary of VOXX and VOXX DEI Canada Ltd. are
the Buyers.
The cash purchase price is $11
million and the assets the Buyer acquired include inventory,
accounts receivable, IT systems, intellectual property (which
includes patents, trademarks, domain names, and copyrights), plus
certain fixed assets. The Buyer, following a soon-to-be-completed
agreement with Nutek Corporation in exchange for 25% of the newly
formed subsidiary, will assume ~$4.2 million in trade payables and
claims, and certain obligations in Canada related to retention of
employees and real estate leases. After speaking with various
parties during its due diligence and based on the value of
inventory and accounts receivable, the Company believes it should
generate more than $10 million in cash within the next two
quarters. The Company also expects the acquisition of assets to be
accretive in this current fiscal year, taking a conservative
near-term outlook based on the current COVID-19 environment. This
transaction is expected to add ~$50 million in net sales on an
annualized basis, provided there is no further deterioration in the
economy due to the global pandemic.
Directed has been VOXX's primary competitor in the North America
RSS business for years, and to a lesser extent, in the CC segment
(telematics). Now, the combination of assets provides VOXX with a
stronger offering for its customers, while also expanding its
distribution network. Further, the addition of Directed's top-tier
engineering team will help drive innovation as it brings together
the best engineering talent in the industry.
Within the RSS business, Directed boasts a portfolio of eight
brands, led by Viper®, along with Autostart®, AstroStart®,
Automate®, Avital®, Clifford®, Directed®, and Python®. Analog and
digital products include security, remote start and combined
systems directly hardwired into vehicles, as well as systems with
data bus interface modules. Acquired assets also include an
accessories line. Within the CC business, products are sold under
the Viper and Directed brands. This asset purchase adds not only
new products with consumer-rich features, it also brings Directed's
market-leading Vehicle Control Platform, which provides
subscription-based revenue and the potential to expand into
enterprise and fleet B2B markets. All brands are sold through an
expansive distribution network which includes aftermarket and
electronic specialists, wholesalers and distributors, national and
regional CE auto aftermarket retailers, car dealerships and
expeditors, and to the Original Equipment Manufacturer ("OEM")
markets.
Pat Lavelle, President and Chief
Executive Officer of VOXX International Corporation stated, "I have
known the Directed team for years, having competed against them at
every turn, and we could not be happier in adding their brands,
customers and team to the VOXX family. This is a natural fit for
both companies, with far reaching synergies and opportunities to
leverage platforms and talent to improve the customer offering,
learn from each other and enhance value. The engineering talent we
are adding is exceptional and we already see areas for cross-over,
sharing best practices and leveraging their skillsets for other
technology breakthroughs. Our balance sheet remains strong and we
expect to recoup the cash outlay for this transaction within the
next two quarters. Thus, this is an acquisition that essentially
will pay for itself on a cash basis in the near-term, following the
sale of inventory and collections, and significantly strengthen our
customer value-proposition."
About VOXX International Corporation
VOXX International Corporation (NASDAQ: VOXX) has grown
into a worldwide leader in Automotive Electronics and Consumer
Electronics, with emerging Biometrics technology to capitalize on
the increased need for advanced security. Over the past several
decades, with a portfolio of approximately 30 trusted brands, VOXX
has built market-leading positions in in-vehicle entertainment,
automotive security, reception products, a number of premium audio
market segments, and more. VOXX is a global company, with an
extensive distribution network that includes power retailers, mass
merchandisers, 12-volt specialists and many of the world's leading
automotive manufacturers. For additional information, please visit
our website at www.voxxintl.com.
Safe Harbor Statement
Except for historical information contained herein, statements made
in this release constitute forward-looking statements and thus may
involve certain risks and uncertainties. All forward-looking
statements made in this release are based on currently available
information and the Company assumes no responsibility to update any
such forward-looking statements. The following factors, among
others, may cause actual results to differ materially from the
results suggested in the forward-looking statements. The factors
include, but are not limited to the: risk factors described in the
Company's annual report on Form 10-K for the fiscal year ended
February 29, 2020 and other filings
made by the Company from time to time with the SEC. The factors
described in such SEC filings include, without limitation: the
impact of the COVID-19 outbreak on the Company's results of
operations, the Company's ability to realize the anticipated
results of its business realignment; cybersecurity risks; risks
that may result from changes in the Company's business operations;
our ability to keep pace with technological advances; significant
competition in the automotive electronics, consumer electronics and
biometrics businesses; our relationships with key suppliers and
customers; quality and consumer acceptance of newly introduced
products; market volatility; non-availability of product; excess
inventory; price and product competition; new product
introductions; foreign currency fluctuations; and restrictive debt
covenants. Many of the foregoing risks and uncertainties are, and
will be, exacerbated by the COVID-19 pandemic and any worsening of
the global business and economic environment as a result. The
Company assumes no obligation and does not intend to update these
forward-looking statements.
Investor & Media Relations
Contact:
Glenn Wiener, GW Communications (for
VOXX)
Tel: 212-786-6011 / Email: gwiener@GWCco.com
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SOURCE VOXX International Corporation