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Avid Technology, Inc. and Pinnacle Systems, Inc. recently announced that Avid has entered into a definitive agreement to acquire Pinnacle in a cash and stock transaction. Under the terms of the agreement, Pinnacle shareholders will receive .0869 shares of Avid stock and $1.00 in cash for each Pinnacle share. The purchase price represents a 30% premium over Pinnacle’s closing stock price of $4.97 on March 18, 2005.
Following the closing, the parties expect that Pinnacle’s award-winning professional products – such as the MediaStream broadcast playout server and the Deko on-air graphics system – will enhance Avid’s end-to-end broadcast production pipeline, which has helped Avid become a global leader in that industry. In addition, Pinnacle’s consumer video business – which to date has shipped more than 10 million units – will form the basis for a new consumer video division at Avid, providing the company with an immediate avenue into that segment.