International. Avid announced that it has taken another significant step towards the company's vision that has become known as Avid Everywhere. This step consisted of completing the acquisition of Orad Hi-Tec Systems, a provider of solutions such as real-time 3D graphics, video servers and the management of workflows related to live streaming.
The Orad product lines perfectly complement the Avid MediaCentral Platform and enable Avid to continue to deliver on its commitment to giving media organizations and creative professionals more comprehensive workflows with more choice, more flexibility and more operational efficiency.
More than 600 customers around the world rely on Orad's state-of-the-art technology to produce graphics and broadcast live events and sporting events. Avid plans to expand its network of offerings and distribution with the Orad product line, which are ideal for newscasts, visual elements for channel identity, the production and enhancement of sports coverage, elections and other special events, virtual studios, video walls and virtual advertising.
With this expansion in the capabilities of the Avid MediaCentral Platform, media organizations will be able to reduce the burden of seeing how to combine fragmented workflows in their productive environments which, in turn, reduces complexity and interoperability issues thus increasing efficiency.
"Orad has built an incredibly talented team of visionaries and product design experts and has created a successful customer service culture. We are excited to have them now as part of the Avid family," said Louis Hernandez, Jr., president and CEO of Avid.
The integration of Avid and Orad is expected to bring numerous significant benefits to both companies' customers, including:
Improved integration.— Orad's core solutions are already integrated with Avid MediaCentral Platform products, including graphics integration with Media Composer and Avid's iNews newsroom management software, as well as video server support for DNxHD ingestion and playback. In the near future, our customers will be able to take advantage of even greater integration between Avid and Orad solutions.
Our intention is to tightly integrate Orad's products into the Avid MediaCentral Platform to provide media organizations with a more efficient and comprehensive game of graphics for live broadcasts and a set of new capabilities for live production.
Efficiency improvements.— When more crucial workflow solutions have been integrated into a single platform, complexity will decrease and there will be fewer interoperability issues, helping media organizations be more productive.
A complete option with an open ecosystem.— Although the Avid MediaCentral Platform will now include its own line of graphics for live broadcasts, through Orad, users will be able to freely choose the solutions they want to use in their productions.
More options for workflow management.— Orad's workflow management solutions beautifully complement Avid's material handling and workflow solutions,
Transaction Overview
Under the terms of the agreement, Avid paid €5.67 in cash for each of Orad's common shares, which, at the current exchange rate, is equivalent to approximately $65 million USD, which is the estimated net amount of the acquisition.
The company financed the transaction with proceeds from the sale of its recently announced convertible preferred debentures. Avid expects the transaction to be reflected based on adjusted earnings before interest, taxes, depreciation and amortization and cash flow. In addition, the company expects to provide updated annual guidance regarding the second quarter business report, which will include the impact of the transaction.
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