Bowers & Wilkins Takes Back Control

[RaceCarDriver]

https://www.audioholics.com/news/bow...rol-of-company

You had to be happy for Joe Atkins, the longtime owner of Bowers & Wilkins, when the news broke back in 2016 that he sold that brand, along with Classe’ and Rotel, to a Silicon Valley startup owned by Gideon Yu, an ex-Facebook executive and part owner of the NFL’s San Francisco 49ers. Atkins, as the CEO and majority shareholder, had built the company into one of the most lauded names in the loudspeaker business, starting with his leadership of the brand back in the late 1980s. In 2016, Bowers & Wilkins enjoyed rock solid distribution worldwide being sold in many of the world’s best dealers. Bowers & Wilkins was getting a foothold in the lucrative and more mainstream automotive space with branding deals with carmakers like Volvo, McLaren, and others. The brand had a leading position in the high-end wireless headphone space, and was a product sold in the tony Apple Stores nationally.

The friendship between Yu and his Eva Automation was a fast one, reportedly resulting in this sale in a mere thirty days. Yu was able to raise a good sum of money towards the rumored purchase price of $150,000,000. Like a shotgun wedding, things moved quickly in the deal but there were a lot of bumps in the road. Classe’, the high-end electronics brand that was sold in conjunction with Bowers & Wilkins speakers, was unceremoniously and almost inexplicably shuttered. The public word was that the brand wasn’t profitable, so it had to go. And go it did – right into the hands of San Diego-based Sound United (owners of Definitive Technology, Polk, Denon, Marantz and various 12-volt car audio brands), which scooped up the electronics company, its engineers and leadership team, so that the high-end mark could be relaunched in 2019. Despite claims of the staff remaining the same, many retired, moved on, or were let go. Public relations firm Nicoll PR, which had repped B&W for years, resigned shortly after the purchase by Yu and his new group.

With the vision of a computer company start-up more than a well-established player in the high-end consumer electronics space, Eva’s stated goal was to take on Google and Amazon in the smart speaker arena. Yes, you read that right. The problem is that inside sources suggest that Google and Amazon actually lose significant money on each speaker sold, because they are not really in the speaker business as much as they are in the data business. You may say that what you buy and access to how you buy it is far more important than losing roughly $100 on a smart speaker. That money could be made back quickly by the likes of Amazon and Google in their platforms. Eva, despite making some gorgeous products in their Foundation lineup, never really had a chance.

A few months ago, rumors that Bowers & Wilkins was in play started bubbling up, as no $30,000 per month Madison Avenue PR firm or pie-in-the-sky vision could make a traditional loudspeaker brand into the next IPO-worthy darling of San Jose. Suitors were sought, but none were found. Control of Eva, with money still owed to him and other investors, has recently switched back to Atkins, reportedly at the behest of the banks. This week, the company hired back Nicoll PR, which will be a popular move with the media, as well as a stabilizing force for the brand. With Classe’ gone, Rotel hasn’t gotten the love as a brand that it has in the past. Perhaps that will change going forward.

For audiophiles and home theater enthusiasts alike, the change in ownership is likely a good thing, as Atkins’s team will bring back brand stability as he may seek a new buyer after cauterizing the wounds caused by Eva’s long-shot idea of turning an established speaker brand into a tech start-up.

Bowers & Wilkins Next Steps?

Even the best AV dealers are reeling in the post COVID-19 economy. Some stability with one of their premium brand partners will likely viewed as a positive. Consumers, more housebound than ever, are looking for premium entertainment experiences from streaming media, be it audio or video, in their homes, as the concept of how social distancing is going to work in a movie theater is an unsolved equation. Home theater offers 4K video, object-based surround sound, countless content options, including Netflix, Amazon Prime, Hulu, Disney+, and many others, along with music streaming options that allow the listener to have access to to pretty much every recording ever made (often in CD or higher resolutions) for about the cost of one compact disc per month. Making these entertainment hubs sound their best is a solid basis for Bowers & Wilkins to build from for the short term as they look for a more suitable new owner. For now, the entire industry is wondering if Joe will be holding court at next year’s CES in the high-roller room of The Mirage hotel, assuming that there will be a CES show next year, and that any high-end audio companies will attend.

[RaceCarDriver]

And a twist of events

https://www.strata-gee.com/bowers-wi...-sound-united/

In yet another twist in the long and winding saga of Bowers & Wilkins (B&W), it was announced late Friday that the company has entered into an agreement to be acquired by Sound United, the parent company of several audio brands such as Denon, Marantz, Polk Audio, Definitive Technology, HEOS, Classé, and Boston Acoustics.

In a short one page announcement released late on a Friday afternoon, Sound United announced that it has signed a letter of intent to acquire venerated audio brand Bowers & Wilkins. Adding yet another fine audio brand in its growing stable of top audio companies, Sound United seems to be continuing to fill out the higher end or luxury segment of their portfolio by adding the high-end B&W speaker brand.

It is a reunion of sorts, with B&W joining a portfolio of audio brands that includes Classé, a high end line of electronics that at one time had been part of B&W years back. Sound United acquired Classé back at the beginning of 2018 – after the company had been jettisoned out of B&W by its new management at the time, led by Silicon Valley persona, Gideon Yu.

“Over the course of five decades Bowers & Wilkins built one of the most prestigious brands in the global speaker market with industry-leading acoustical engineering, iconic design and marketing. B&W is a transformative brand and we look forward to the opportunity to finalize the transaction. This reflects Sound United’s unwavering focus to achieve its mission of bringing joy to the world through sound.”

Kevin Duffy, CEO of Sound United
In some ways, the announcement was a surprise, coming as it did, late in the day at the end of the week. But in other ways it was not a surprise at all. I had been making diligent efforts to reach out to folks related to B&W, as the Strata-gee network of sources had been tingling with tips of something major being in the works.

It also follows by just a few short months the news of major changes taking place at B&W, with Gideon Yu and Greg Lee leaving the Board of Directors in a major shake-up of company management. Strata-gee reported this news in early March of this year.
The Sound United announcement notes that “the proposed transaction remains subject to ongoing discussions, confirmatory diligence, regulatory approvals, and other required consents.” The company promises to release further details when appropriate.

We should note that this announcement is of a letter of intent…and NOT a completed deal. There is still much that could emerge to impact these discussions.

Long time Strata-gee readers will recall a series of posts when Sound United and Onkyo entered into a similar agreement in May 2019…only to eventually have that deal fall apart by October. So caution and patience rule the day, as we monitor the progress of this deal.

[prepress]

Sound United didn't have a high-end speaker brand in its stable, though they're trying to reposition Polk as such (Polk's Legend series is getting lots of attention). So this would make some sense for Sound United if it goes through. With Marantz and Classé already, SU has some foothold in the high-end market. We'll see what happens with B&W.