Media Vision Technology Inc. Retains Investment Bankers to Evaluate Strategic Alternatives

Strategic Insights -

Media Vision Technology Inc. has engaged investment bankers Hambrecht & Quist to assist in evaluating strategic alternatives for its retail sales of PC audio circuit boards and upgrade kits. The company is exploring the divestiture of its retail business to focus on the development of its audio semiconductor technology and licensing of its audio technology to third parties. Despite its strong brand name, Media Vision has struggled to achieve sufficient margins due to a lack of access to low-cost manufacturing.

Key Takeaways:

  • Media Vision Technology Inc. has retained investment bankers Hambrecht & Quist to evaluate strategic alternatives for its retail sales of PC audio circuit boards and upgrade kits.
  • The company is considering divesting its retail business to focus on audio semiconductor technology development and licensing of its audio technology to third parties.
  • Media Vision has struggled to achieve sufficient margins due to a lack of access to low-cost manufacturing.
  • The company has engaged in preliminary negotiations with several parties regarding licensing of its audio technology and has recently entered into a licensing agreement with a third-party company.
  • The agreement provides for the licensing of certain of Media Vision's audio semiconductor technology in exchange for royalties based on the third-party company's sales of products incorporating this technology.

Statistics:

  • Media Vision Technology Inc. has approximately 100 employees in its retail business operations who have been given notice under the W.A.R.N. Act.
  • The royalties from the licensing agreement with the third-party company will not commence until 1996.
  • The royalties are not guaranteed and depend on the third-party company's sales of products incorporating Media Vision's audio technology.

Sources:

  • [PRNewswire, August 1, 1995]