"...Vivotek will stay as an independent entity and a pubic listed company with the same management team."
Sure! They always say that...
Anybody knows any acquisition that keeps that promise for at least two years?
Vivotek Delta Acquisition Concludes
Published Oct 02, 2017 18:07 PM
On August 8, 2017, Delta Group made an offer to acquire Vivotek.
Now, the acquisition process has concluded.
Inside this note, we examine the conclusion, the ownership details, share feedback from Vivotek management, concluding with an analysis of the potential impact to Vivotek and how this fits with the ongoing race to the bottom and to safety.
Delta ***** ***********
***** ***** *** ******** **.**% ** Vivotek's ******, ********* ** *******. **** will **** ***** *** *********** *********** (similar ** ******* / ****** *** Hikvision / ******* **********). ******** ** Delta's ***** *********** ** *******, *******'* stock ********* *** ***** ******* **** the ******* * ************ **** ****** ~1/3 ** *** *******, ** ***** from **** ***-*********** ****** ***** ****** chart:
Board *******
******* ***** **** ***** ***** ** directors ******** ******** * ****** *** and *** **** *** ** *** planned ***** **** ****, **** ***** can **** *** ****** *** ***** seats. ******* ***** **** "*** ******** shareholders *** ********** **** ** **** to **** ***** ***** *** *********** shareholder."
Delta's ****
*****'* ******** ********* *** ******* **** to ** ** ***** '*&* ********' and **** ******* ***** ******* "*** *****-***** capabilities ** [*****'*] ******** ********** *********", claiming * ********* ********:
- ********: "******* ******* *********** ********* ******* of ********** * ****** ******** ** applications"
- *****: "******** *****’* ******* ****** ******** and ****** ******** ** ***** *** performance"
- *************: "******* **** *****’* ********* ************* knowhow *** *********** *********** ********** *****"
Who ** ***** *****?
***** *****(** ******** ** ***** ********) **** ~$8 ******* ****** ******* *** ** one ** *** ~** ******* ********* in ******, ****** **** *** **** recognition ** *** ****. *** ******* is ************* *** ********* * ***** electronics ************, ****** **** **** **** expanding **** ***** *******, **** ** automation, ***** ******* ***** ** ******.
***** ******* ********* ***** ********** ** the ******** ** ***** * ********:
*** *******'* ********* ***** ***** * sense ** ***** ***** *** *********. Notice **** ****** ** ** ** automation *** **** * ****** ************ related *******, ***** ***** *** ***:
Vivotek ********** ********
******* ******** ******** ** **** ** the ***********, *********** ************:
******* **** **** ** ** *********** ****** and * ***** ****** ******* **** the **** ********** ****.
************ ***** ** *********, **** *******:
*** ******* ************ ********* **** **** remain *********, ***** ** ******** **** Delta *********** **** ***** ********* ********** and ******** ************ ** ********* * stronger *** ******* *********.
*** ***** ***** *** ***** ***** continue, ********* ** *******:
******* ***** **** **** ****** ** *** surveillance ******** *** *** ***** ** offering *** ******** ************ ********* **** not *******.
** *** **** ****, ******* ********** the ********* ******** ** ******** *** manufacturing **** ***** ***** ** *** plan.
Financials *** ****** *********
******* ********* *********** *** **** ********** solid, **** * **% **** **** the **** * *****, ***** **** $85 ******* ** **** ** $*** million ** **** (*******'* ************ ******* *********). ***** *********** ** ** ~**% ****** ******* are **** ~**%.
*** *********** ***** ****** ******* ** a ****** ************** ** ~$*** ******* USD, ~*.* ***** ***** **** *****. **** is * ****** ********* *** * company **** ********* ** **** ******* and ******* ******** ** ************* ** still ******** **********.
*******'* ****** ********* ** ***** **** more **** **% **** *** **** in ****:
Competitive *********** ** *******
*******, ****** ***** ************ ************* **** been **** **** *** ** *** rise ** *** ******* *** *** race ** *** ******. ******* *** done comparably **** *** *** ****** *** largest ****** ***** ************ ************.
** *** ***** ****, ****** **** decade, ******* *** ******* ** ** more ** ** *** ******** *** niche ****** ****** **** * **** market ** ****** ********, ** ***** cost ******* **** ********* *** ***** combined **** ***** *** **** ********** ***** and ********* ************ **** ****** ***** *******.
Race ** ******
** ******* *******'* **** **** ** part ** ** ******* '**** ** safety' **** ** * ******** ** the **** ** *** ******. *********** companies, *** **** *******, *** ****** the **** ********** **** ******* ****** and *** *********** ** ******** *** Dahua ** ***** ** ******* ** sales *** *********. ******* ** ** Axis *** ********* ******* *** ** Canon ********* ******* *** ** ****** *******, ****** '*********' ***** ************ **** *****, ********* **** *** **** * larger / **** ******* ****** ** shelter **** ****** **** **********, *** seeing **** ** * *******.
******* ******* *** ******** ***** "**** **** did *** ******* **** ** *** bottom **** ** *******'* ********?" ******** to ****** *** ***** ****** ***** production *** ********** ********. ** ** think **** ***** *** ******* ********** benefits, ** **** *** ~*** ****** than ******* *** **** ********* ***** could **** **** ** ******** ************* costs. ** *** ***** ****, *** meager ******* **** *******'* ******* ***** price (**** ***** **** ******* ********, *.*., for ***** ******** ****** ********* ******** such ** ******* ** ****) ** a **** **** ******* *** ********** ***** independent *** *** ** *** ******.
Automation *** ***** ************ ************ **** **********
***** ********** *** ***** ************ *** both ********* ******* ** ****** *************, the *********** ** *********** ** ***** systems *** ******** * ***** **** of *** ******* ***** ************ ******, as ***** ******* *** ********* ****** and ******* **********. ******* **** **** change with *** ********* ** '***' *** more ******* ******** *** ***** ************ manufacturers **** ********* *** **** **** ** rely ** ********** ** * **** market *** *********** *******.
How **** ** ****?
** ****** *** *********** *** ** have * *********** ****** ** *******, especially *** ** *** ***** ****. To *** ****** **** ***** ****** Vivotek ** ****** *********** ** ******* emphasizes, *****'* ******** ********* *** ************* ***** could **** ******* ****** ******* ** this ********** ******.
** ***** ** *** ****, ** do *** ****** **** ** ******** from ***** **** ** ***** ** sales ** ******** ***** ***** **** not **** * ****** ******** ** automation *** * ****** ******* ***** to ****** / **** *******.
****, ***** *****'* ***** ** **********, ** Delta ******* ****, ** ***** ******* **** Vivotek **** ***** **** ** * niche ****** ** **** *******, ****** than ******** ** **** ****** ********, which ***** ******** ***** ****** ******* approach.
[****: **** **** *** ***** ******** on ****** **, **** *** ******* in ******* ** ******* *** ********** of *** ****.]
Comments (14)
Claudio Almeida
Aug 10, 2017JH
John Honovich
Aug 10, 2017Anybody knows any acquisition that keeps that promise for at least two years?
Answers:
March Networks, acquired by Infinova 2011/2012, CEO and VP Sales/Marketing still there many years later.
Axis, acquired by Canon 2015, everybody in management remains as is.
Even Milestone, acquired by Canon 3 years ago, same CEO, still lot of the same key people.
Btw, technically Exacq meets that as well, but the co-founders / management team left after the 3 year earn-out.
Let me say, I agree that generally management teams change but a lot of that has to do with how the acquirer runs the company. The way Delta describes the deal leads me to believe they will be run as a subsidiary which lends to a higher probability of management staying. By contrast, if Delta was saying they were buying the 'technology' or folding into some existing division, likelihood of management team getting pushed out would be very high.
Claudio Almeida
Aug 10, 2017Yes, John, you're right.
But I'm afraid the list of those companies who changed everything is even bigger. And the worst thing is those companies who destroyed the acquired companies.
For instance, Schneider acquired Pelco; Tyco group acquired DSC, ADT, American Dynamics and others
At least here in Brazil, these companies almost disappeared from the market
G4S acquired several Brazilian companies and close them, even failing to conquer the Brazilian market.
Same for Siemens.
U
Undisclosed #2
Aug 11, 2017No disagreement here, but it would be interesting to see the statistics on acquisitions where it was clearly stated the acquired company will remain independent. If no such claim is made, then it can probably be assumed there would be fairly dramatic changes.
Pelco is a good example where they appear to have been integrated with Schneider Electric rather than continuing to act as an independent organization under a parent organization.
Claudio Almeida
Aug 14, 2017"Pelco is a good example where they appear to have been integrated with Schneider Electric "
I think the better word in this case would be "Pelco... have been DESintegrated by Scheneider Electric"
UM
Undisclosed Manufacturer #5
Aug 14, 2017Yes but this is a fairly common practice in Taiwan, and, most of the time, the acquisition does stay independent. Delta will of course insert some C-Level influence overtime, and perhaps do operational changes into things like Supply Chain, as well as some process changes to improve efficiency, but as far as what Vivotek's customers see, I would expect very little change.
UM
Undisclosed Manufacturer #1
Aug 11, 2017Their logo's seem to match pretty well... so they've got that going for them.
:)
Tim Pickles
Aug 14, 2017I'm probably with John on this one. Tyco, as we all know, pretty well decimates the companies it takes over - but that is their corporate strategy and underlying business model.
When the acquiring company is more at arms length from the entity it's taking over, such as Delta is, they may well sit back and leave them to it. This make it easier to off-load at a later date also should the company flounder or be sold of as a significant asset.
The Latin American market is a brutal market so probably not indicative of the EMEA region which is, perhaps, a little more pragmatic. Having said that, the Honeywell acquisition of Ademco/Micro-tech years ago, left the Galaxy product woefully supported with next to no development in over a decade set to follow a DM path to hell. I'm guessing it's the arrogant giant approach of the Honeywells/Tycos, that's the difference here. They are a million miles away from the customers face but are very much the bulge in NASDAQs trousers.
U
Undisclosed #3
Aug 14, 2017I'm guessing it's the arrogant giant approach of the Honeywells/Tycos, that's the difference here. They are a million miles away from the customers face but are very much the bulge in NASDAQs trousers.
In Tyco's case, the bulge may also be due to an expanding Johnson ;)
UI
Undisclosed Integrator #4
Aug 14, 2017Well goodbye vivotek as we.know it.
JH
John Honovich
Oct 02, 2017Update 10/2/2017:
Delta Group has acquired 49.22% of Vivotek's shares, according to Vivotek. This will make Delta the controlling shareholder (similar to Techwin / Hanwha and Hikvision / Chinese government). Previous to Delta's stock acquisition of Vivotek, Vivotek's stock ownership was quite diverse with the largest 9 shareholders only owning ~1/3 of the company, as shown from this pre-acquisition Taiwan stock market chart:
Board Control
Vivotek noted that their board of directors election occurred 4 months ago and the next one is not planned until next June, when Delta can vote its shares for board seats. Vivotek added that "the original shareholders and management team is glad to have Delta being the outstanding shareholder."
U
Undisclosed #6
Oct 03, 2017Would this effect Avigilon since Vivotek makes the fisheye camera for them?
JH
John Honovich
Oct 03, 2017As a general statement, I do not see why this move would impact any Vivotek customers since Delta Group has no real competitive issue / conflict with those companies.
UI
Undisclosed Integrator #7
Oct 05, 2017Total random note:
Vivotek was/is still one of my lead manufacturers.
I left the Security industry to join the A/V industry 3 months ago. In meetings here and there internally and with customers the word "Vivotek" came up a few times. I asked our PC to spell what they were saying and it was "Vivitek."
Guess who owns Vivitek?
Delta.