LOUIS—Belden said it has submitted a binding offer to
purchase privately held Grass Valley for $220 million. The binding offer is
subject to consultation with Grass Valley’s foreign labor works council. Grass
Valley provides technologies including production switchers, cameras, servers,
and editing solutions for broadcasters.
“Today is an exciting day for us at Grass Valley. Belden Inc. announced its intent to bring Grass Valley on board and combine it with Miranda,” Grass Valley’s announcement said. “Grass Valley will remain the name of the combined businesses.”
Grass Valley, which started out in the eponymous California Gold Rush community, now has a home office in Hillsboro, Ore., and employs 942 people around the world. Operations will be headquartered in Montreal. A spokesman for Belden said it was too early in the process to address the question of cutting staff.
“Belden intends to utilize the joint Belden/Miranda/Grass Valley integration team to develop a detailed integration plan that best leverages the combined capabilities of the company. However, we are early in the process and it is too early to speculate on the number of affected positions. Belden is committed to keeping employees informed throughout the acquisition and integration process,” he said.
As for the product portfolios, the same goes:
“An integration team comprised of the product unit leaders, in conjunction with the executive team, will carefully review the portfolio of the combined entity and determine the future roadmaps. We will communicate on a timely basis regarding the portfolio,” he said.
Belden will continue to use and promote the Grass Valley brand, the cachet of which was established in the 1970’s with the company's introduction of a video switcher equipped with what essentially was a Mercury marauder shifter. The design redefined video switchers.
“Upon completion of the acquisition, Belden will combine the Miranda and Grass Valley entities and go to market under the Grass Valley brand under the leadership of Miranda President Marco Lopez,” the spokesman said.
Grass is being sold by San Francisco-based private equity firm Francisco Partners, which bought Grass in July of 2010 for $100 million. In January of 2013, the firm brought in Tim Thorsteinson to run the company, as he had in the 1990s when it was owned by Tektronix and sold to Thomson, which later became Technicolor. Bringing Thorsteinson generally is considered a divestiture signal, given his first gig with Grass and subsequent CEO roles at Leitch, which was sold to Harris on his guard, then Harris later was sold to investors for $225 million. Thorsteinson was also brought in to serve on the board of Miranda in March of 2012 when the company revealed it was entertaining offers. Belden bought Montreal-based Miranda the following June for C$345 million.
Thorsteinson will be out as the chief of Grass; Marco Lopez, president of Miranda, will run the integrated companies, according to a letter from Belden president and CEO John Stroup, obtained by TV Technology.
“Marco Lopez, president of Miranda, will lead the combined businesses,” the letter said. “The hard work has already started behind the scenes as we begin integrating Grass Valley and Miranda. We have established a core integration team made up of functional leaders from Grass Valley and Miranda. The team, led by Kendall Morgan, will continue to work together to determine a detailed integration plan that best leverages the combined capabilities of the company.”
The spokesman said Thorsteinson would be “actively involved throughout the transition period.”
Belden also reported that its fourth-quarter income from continuing operations
declined year-over-year to $23.93 million or $0.54 per share, from $39.48
million or $0.88 per share. Income from continuing operations decreased largely
as a result of favorable discrete tax items in the year-ago period. Net income
per share was $0.51, compared to $3.70, prior year. Adjusted income from
continuing operations per share was $0.91, for the quarter.
On average, seven analysts polled by Thomson Reuters expected the company to
report profit per share of $0.90 for the quarter. Analysts’ estimates typically
exclude special items.
On a GAAP basis, revenue totaled $509.8 million, up 6.7%, from $477.7 million
in the fourth quarter 2012. Adjusted revenue for the quarter totaled $515.9
million, up 7.2%, compared to $481.2 million in the fourth quarter 2012.
Analysts expected revenue of $518.24 million for the quarter.
On a GAAP basis, the company expects first quarter 2014 revenues to be $491
million-$501 million and income from continuing operations per share to be
$0.55 - $0.60. The company expects its first-quarter adjusted revenues to be
$495 million-$505 million and adjusted income from continuing operations per
share to be $0.77 - $0.82. Analysts expect the company to report first-quarter
profit per share of $0.88 on revenue of $516.37 million.
For the full year ending Dec.31, 2014, the company expects revenues to be
$2.096 billion-$2.136 billion and income from continuing operations per share
to be $2.95 - $3.25. For the full year ending Dec. 31, 2014, the company
expects adjusted revenues to be $2.11 billion-$2.15 billion and adjusted income
from continuing operations per share to be $3.81 - $4.11. Analysts expect the
company to report fiscal 2014 profit per share of $4.05 on revenue of $2.15