Sonic Solutions and Roxio have announced that Sonic will acquire the consumer software division of Roxio for a total purchase price of $80 million. Under the terms of the transaction, Roxio will receive $70 million in cash and shares of Sonic common stock valued at $10 million. Sonic expects the acquisition to provide them with a recognized set of consumer software brands; access to long-standing distribution channels; strong product marketing expertise; and relationships with retail outlets. Roxio plans to focus its business on the digital music market and will change its corporate name to Napster and trade under the ticker "NAPS" on NASDAQ, assuming the successful completion of the transaction.
Under the terms of the deal, Sonic will purchase essentially the entire Roxio software operation including Roxio's CD and DVD recording, authoring, photo, and video editing application products including Easy Media Creator, PhotoSuite, VideoWave, Easy DVD Copy, and Toast. Sonic expects to retain most of the current employees of the Roxio organization. Sonic intends to continue the Roxio brands, and current distribution and OEM relationships. Completion of the acquisition, which is expected to close in the fourth quarter of calendar year 2004, is subject to the approval of Roxio stockholders, expiration or termination of the applicable Hart-Scott-Rodino waiting periods, and other regulatory and customary conditions.