British audio company Bowers & Wilkins, famous for its premium speakers, has been sold to Eva Automation – a Silicon Valley startup company which has only existed since 2014.
Last weekend Bowers and Wilkins CEO Joe Atkins reached a sale agreement with Eva Automation, a 40-person company started in 2014 by former Facebook chief financial officer and current San Francisco 49ers owner, Gideon Yu.
Atkins will remain CEO of the venture and maintain a significant stake in the company, while Yu will serve as executive chairman.
Despite the acquisition and in keeping with their CEO’s continued involvement in operations, the renowned Bowers & Wilkins name will remain for the new venture.
Both companies have declined to disclose the financial terms of the deal, with Bowers & Wilkins’ staff of 1100 employees currently looking set to join the small team of 40 at Eva Automation.
Who is Eva Automation?
Eva Automation is yet to have released any products, but this major acquisition is sure to change the startup’s current dormancy when it comes to creating products.
Yu has said that Eva Automation’s first new products are planned for mid-2017, with the CEO emphasising in a public letter to friends of the company that the acquisition of Bowers & Wilkins would help realise its long term product vision.
“When it was time to seek out partners for our journey ahead, Bowers & Wilkins was unquestionably our number one choice and, after I met Joe Atkins and his team, it was immediately clear that we share the same long term product vision and sincere passion for home entertainment,” he said.
“One of the most important parts of our acquisition is that Joe is maintaining a significant equity stake in our combined company and will be joining our board of directors, further aligning all of our interests.”
Bowers & Wilkins purchase a bold move
The acquisition of Bowers & Wilkins is a big coup for such a small and relatively young company as Eva Automation.
Bowers & Wilkins became a household name before speaker companies had to distinguish themselves through Spotify integrations and voice recognition capability.
The British company have been one of the biggest names in the audio and loudspeaker industry since its formation in 1966.
While financial terms of the deal between the traditional British company and the young Silicon startup weren’t revealed, Caledonia Investments did sell its 20% stake in Bowers & Wilkins for £24m in cash and a £500,000 dividend.
When figuring in what the 20% stake was valued, it has been estimated that the value of the acquisition of Bowers & Wilkins was somewhere around £122.m ($177.5m).
New CEO of the joint venture, Atkins, told Bloomberg that the acquisition of Bowers & Wilkins made sense, despite going against the grain of long-running and well-established brands such as his company acquiring newcomers like Eva Automation, with the reverse being the case in this instance.
“It will take some explaining, but I think when the verdict comes back, it will be clear that this is exactly what Bowers & Wilkins should be doing,” he said.
Eva Automation plans to begin selling new products that incorporate the company’s work and are inspired by Bowers & Wilkins reputation and standards by early to mid-2017.