Putting a high technology company up for sale is never an easy proposition, let alone during the time of economic volatility that has been seen in the past several years. So it was no surprise that as the year 2010 ended and the acquisition papers were signed, Grass Valley executives breathed a sigh of relief as they marked the end of a period of uncertainty for the company.
As was announced last summer, the company—which has a rich 50-year heritage in the broadcast industry—was sold
for approximately $100 million to Francisco Partners, an 11-year old San Francisco based venture capital group. The firm, which has a history of investing in technology in mid-markets, put in place a new leadership team headed up by Alain Andreoli, formerly president of Sun Microsystems and an operating partner at Francisco Partners.
Andreoli met with the industry trade press last week at the MLB Network in Secaucus, N.J. which houses a large complement of Grass Valley technology. Andreoli—a 25 year veteran of technology companies—outlined some of the company’s plans for its latest acquisition, which includes some new faces and some familiar ones.
Jeff Rosica, who for the past several years, has represented the face of continuity for Grass Valley, has been promoted to executive vice president and chief sales and marketing officer and will be the chief liaison between the company and its customers, according to Andreoli. Ian Halifax has been brought in as the new chief financial officer. Charlie Dunn, based in Beaverton, Ore., is the new senior vice president and general manager of the Editing, Servers & Storage Product Group. Martin Fry will oversee Routing & Signal Management as senior vice president and general manager, in Nevada City, Calif. Marcel Koutstaal becomes senior vice president and general manager of the Cameras Product Croup in The Netherlands; and Scott Murray will serve as senior vice president and general manager of the Live Production Solutions division in Nevada City. For the moment, the company has no plans to cut back any of its facilities worldwide, Andreoli said.
Although Andreoli expressed confidence in the company’s current status, he emphasized the need for “balanced change” to help make the company profitable in 2011. He also stressed the need for Grass Valley to stand on its own, after years of ownership by Thomson, which itself was transformed into Technicolor in the past two years. He was also impressed with the company’s ability to be “almost a 'one stop shop'” for the video production industry.
“The part of Grass Valley we carved out as an independent company is really an integrated suite of products. It just makes sense to have this as an independent company,” he said. As for the company’s future direction, “the end of the story could be an IPO, or it could be consolidation, we don’t have a specific agenda. What we know right now is that this going to be a build that will take years and we are willing to support it and let the company flourish as an independent business.”
Although manufacturing and R&D will be based in the various worldwide locations, including its birthplace in Nevada City; executive, marketing and sales and services will be relocated to new headquarters in San Francisco, home to Grass Valley’s new owner and within an hour’s drive of Silicon Valley. The move also signals the importance that IT will have on the future direction of Grass Valley. Andreoli said that the company will continue to invest 15 percent of its revenues in R&D, which it characterized as among “the highest in the industry.”
“We want to position the company as the premier technology solutions company,” he said. “We are a very strong hardware provider but more and more the functionality is moving to the software layer and we are driving for more and more software engineers.”
Services will continue to be a growing part of the company’s business as well. Aengus Linehan, former vice president of services for the Communications and Media Solutions business unit of Hewlett-Packard will head up the group, which will be based in San Francisco. “We feel that services are a very important opportunity for the company to bring more solutions to the customers,” Andreoli said.
As for Rosica, who has seen Grass Valley through its ups and downs over the years, the new ownership represents new opportunities for the company. “Being part of a conglomerate caused us to lose some of our focus and it’s nice to be in an environment where it’s very focused and very sharp,” he said.
Unlike in years past, the company is withholding its new product announcements for NAB until right before the show.
One of Andreoli’s main goals is to restore the company’s image as a leader in the video production industry. “One thing we heard about Grass Valley was that 50 years ago, they were innovators, inventors, pioneers,” he said. “And then they became part of a big corporation and lost a bit of their initial edge. We want to put his back to the forefront. We want to be seen as a pioneer and inventor.”