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French private equity firm Ardian has agreed a near £2bn deal to sell a majority stake in UK music equipment maker Audiotonix to rival PAI Partners, in the latest example of buyout activity picking up after a slow 18 months.
The deal is expected to be announced later this week, according to people familiar with the matter.
With buyouts usually financed by debt, concerns over higher interest rates had prompted many investment groups to pause striking new deals. However, debt markets have picked up in recent months and groups have come under growing pressure to deploy cash raised from their investors after a prolonged spell sitting on the sidelines.
Fund administration company Alter Domus and IT business Presidio are among large companies that have traded between private equity groups in deals worth more than $4bn each.
Founded in 2014, Audiotonix makes sound equipment for concerts and other live events, and has proven a popular and lucrative target for private equity firms.
Based in Chessington, south-west London, Audiotonix was created through the merger of three businesses, DiGiCo, Allen & Heath and Calrec. DiGiCo equipment was used in a concert to celebrate the late Queen’s platinum jubilee in 2022, as well as by pop stars including Natalie Imbruglia.
French private equity group Astorg bought the business in a deal worth £350mn in 2017 before selling it on to Ardian for almost €1bn two years later.
Under Ardian’s ownership, the company has grown both organically and through acquisitions which have expanded its footprint in large markets such as the US.
Last year, the business bought companies including US-based music production software manufacturer Harrison, whose music-mixing consoles have been used to record songs by artists from Michael Jackson to Abba.
Audiotonix generated about £270mn of revenues last year, a near 60 per cent increase on the £169mn generated the previous year, according to Companies House filings.
The company was badly affected by the global pandemic when live music and entertainment events were largely shut down. Sales and profits which declined sharply during this period, have bounced back strongly since then.
European private equity group PAI Partners last year raised about €7bn for its latest flagship buyout fund. The group invests in companies in Europe and North America. Some of its investments include a stake in Froneri, one of the world’s largest ice cream companies.
Ardian and PAI declined to comment.
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