Skullcandy, Inc., which creates world-class audio experiences through its Skullcandy® and Astro Gaming® brands, and Incipio LLC, a leading global consumer technology solutions platform, jointly announced today that they have entered into a definitive merger agreement pursuant to which Incipio has agreed to acquire Skullcandy. Under the terms of the definitive merger agreement, Incipio will pay $5.75 per share in cash, or a total of approximately $177 million.
The purchase price represents approximately a 29% premium over Skullcandy’s closing share price on June 22, 2016, and approximately a 49% premium over the 90-day, volume-weighted average price. Excluding Skullcandy’s cash, cash equivalents and short-term investments of $46 million as of March 31, 2016, the enterprise value of $131 million represents a 59% premium over the enterprise value on June 22, 2016.
Andy Fathollahi, CEO and Founder of Incipio, stated, “We have long admired Skullcandy’s culture of innovation and ability to create pioneering audio experiences with quality and style. Skullcandy and Astro amplify our dynamic mix of products and brands, while bolstering the technical and operational capabilities that serve as the foundation of our platform. The team at Skullcandy and its international presence will also allow us to accelerate the global impact of our multi-brand offense.”
Hoby Darling, Skullcandy, Inc. President and CEO commented, “We are excited to be joining forces with Incipio Group as we believe it’s in the best interests of Skullcandy and our shareholders. The combination of our two companies allows us to better serve our consumers and retailers with focused, best-in-class products in multiple categories. We share a common culture, vision and commitment to driving innovation and this merger will allow our two teams to amplify their efforts going forward. Also, importantly, we remain deeply committed to our teams, retail partners, ambassadors and community. Those things are all part of our DNA as a company born on the mountains in Park City for Skullcandy and in the technology and gaming hub of San Francisco for Astro.”
The transaction will be financed primarily through a new senior credit facility with Monroe Capital Advisors, LLC and Wells Fargo Bank, N.A. The transaction is not subject to a financing condition.