SonicBlue Inc. to acquire the Sensory Science Corp. for 0.11 times revenue

Weekly Corporate Growth Report, Feb 12, 2001

The Deal: SonicBlue Inc. has agreed to purchase the Sensory Science Corp. for $8 million. Sonic Blue is building up its offerings to cover a broad array of digital media aimed at the home.

Discussion: The Sensory Science Corp. designs and markets electronic video products, which it sells through retailers such as Sam's Club and Circuit City, catalogs and television. Its main product is the Dual-Deck VCR, which accounts for about 80 percent of sales, which features two decks built into one unit and performs duplicating, dual recording and editing functions. In addition, Sensory Science is expanding into digital products and MP3 Internet media players.

SonicBlue Inc. makes Internet access and home networking equipment, developing the business of Diamond Multimedia, which it acquired in 1999. SonicBlue's new lineup includes digital audio players and products for broadband access and home networking. It's also working on an Internet appliance code-named DayTripper and equipment that links computers through electrical wiring. SonicBlue has a 41 percent stake in digital media infrastructure company RioPort.com. The company moved its pioneering graphics chip business into a joint venture with VIA Technologies, and its Internet appliance business into subsidiary frontpath.