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Private equity firm in advanced talks to buy Corsair

by Mark Tyson on 19 July 2017, 11:31

Tags: Corsair

Quick Link: HEXUS.net/qadjq5

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PC and video gaming components specialist Corsair looks set to be purchased by a private equity firm. Two sources have spoken to Reuters on condition of anonymity, and the headline deal divulged is that EagleTree Capital would acquire Corsair for over US$500 million. Discussions are said to be in their advanced stages, so a sealed deal sounds likely in short order.

Corsair was set up by Chief Exec Andy Paul back in 1994 and is still in his hands. There was a planned stock market IPO a few years back but it was scrapped. Francisco Partners made a $75 million investment in the company shortly after the IPO plans were withdrawn, providing plenty of working capital for company expansion initiatives and so on.

Reuters thinks that it’s a good time for anyone to invest in a company that is well regarded in the eSports and professional PC gaming fields. It is noted that the market as a whole is bountiful with U.S. consumers spending $30.4 billion on video games and accessories last year. Furthermore, a similar/rival company, Razer Inc, is planning an IPO to raise $3 billion plus later this year, it has been reported.

EagleTree Capital is backed by cash from Goldman Sachs, Macquarie Group and BNP Paribas which will help in the bid to the tune of about $330 million say Reuters sources. The $500 million plus valuation is based upon an industry standard 10x EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) calculation.

HEXUS has reviewed many a Corsair product over the years and would like to be optimistic over the potential impacts of this performance PC accessories stalwart from Freemont, Ca being acquired.



HEXUS Forums :: 13 Comments

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Private equity firms make money by coming in and cutting staff & manufacturing costs.

If I worked for Corsair, I'd be brushing up that CV today, because no one will be safe.
Its not like Corsair have cut manufacturing costs enough already the last few years……

If they do any more cuts, the kits going to fall to bits in days……
omfg buy your corsair products now then sit and watch Rome burn while your warranty period expires.
I really hope this does not mean the 7 year warranty on my SF450 is now going to be cut to something like 2 years,so they can save money.
HEXUS might be optimistic, but I'd be more on the pessimistic side in worrying that things will be cut down (such as the long warranty periods as stated by CAT-THE-FIFTH) to be more profitable for the equity firm, thus shafting customers in the process and damaging Corsair's good reputation.