WALTHAM, Mass., May 19 /PRNewswire-FirstCall/ -- Steinway Musical
Instruments, Inc. (NYSE: LVB) today announced that it has acquired ArkivMusic,
LLC, an online retailer of classical music recordings. Specializing in the
efficient delivery of a broad selection of classical music titles direct to
the consumer, ArkivMusic sells over 90,000 titles, including thousands of
previously out-of-print recordings produced "on-demand" through its ArkivCD
program. The company's annual revenue growth rate has accelerated over the
last four years, exceeding 30% in 2007, with sales last year of just over
$8 million. ArkivMusic will continue to operate independently as a wholly
owned subsidiary of Steinway.
CEO Dana Messina commented, "We are excited to have ArkivMusic and its
employees join Steinway. We share a passion for supporting outstanding music
and musicians, and ArkivMusic is one of the shining lights in the classical
music business these days. This acquisition will help Steinway promote
thousands of musicians that use our instruments around the globe."
ArkivMusic's President Eric Feidner said, "We are extremely excited to
join forces with Steinway. We believe the reach and resources of Steinway can
help us achieve our global growth strategy. It is a privilege to become part
of the fine tradition and values that Steinway represents to musicians and
music fans worldwide. We believe our growing business and extensive
relationships with customers, record labels and radio will add considerable
value to a dynamic brand in classical music."
Steinway will pay $3 million in cash at closing and three annual payments
of approximately $0.5 million. The transaction involves additional potential
consideration based on ArkivMusic's results over the next three years. The
Company does not expect the purchase to have a material impact on earnings in
About Steinway Musical Instruments
Steinway Musical Instruments, Inc., through its Steinway and Conn-Selmer
divisions, is one of the world's leading manufacturers of musical instruments.
Its notable products include Bach Stradivarius trumpets, Selmer Paris
saxophones, C.G. Conn French horns, Leblanc clarinets, King trombones, Ludwig
snare drums and Steinway & Sons pianos.
ArkivMusic -- The Source for Classical Music(TM) (www.arkivmusic.com) is
an online retailer of classical music focused on offering a vast selection of
classical titles through an intuitive interface and a decentralized
distribution platform. Since opening its online store in February 2002,
ArkivMusic has built the largest selection of classical music recordings in
the U.S., with access to over 90,000 titles from over 1,500 labels shipped
from 20 distribution centers. In keeping with its mission of preservation,
promotion, and efficient distribution of classical music, ArkivMusic's
innovative production-on-demand ArkivCD program allows consumers to find and
purchase out-of-print recordings alongside the in-print catalog.
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act
This release contains "forward-looking statements" which represent the
Company's present expectations or beliefs concerning future events. The
Company cautions that such statements are necessarily based on certain
assumptions which are subject to risks and uncertainties which could cause
actual results to differ materially from those indicated in this release.
These risk factors include the following: changes in general economic
conditions; recent geopolitical events; increased competition; work stoppages
and slowdowns; impact of dealer consolidations on orders; ability of new
workers to meet desired production levels; exchange rate fluctuations;
variations in the mix of products sold; market acceptance of new product and
distribution strategies; ability of suppliers to meet demand; concentration of
credit risk; fluctuations in effective tax rates resulting from shifts in
sources of income; and the ability to successfully integrate and operate
acquired businesses. Further information on these risk factors is included in
the Company's filings with the Securities and Exchange Commission.
Contact: Julie A. Theriault