On March 16, Autodesk (Nasdaq: ADSK), a San Rafael, Calif.-headquartered, publicly-held software developer and parent of San Francisco-based Kinetix, completed its acquisition of publicly traded Discreet Logic (Nasdaq: DSLGF) for a little over $400 million in stock. Discreet Logic is the Montreal-headquartered developer of such tools as Flame, Inferno, Fire and Smoke. An initial acquisition agreement was announced last summer (SHOOT, 8/28/98, p. 8).
Discreets employees and its product families will be integrated with the Kinetix unit and become Discreet, an Autodesk division. (‘Logic will be dropped from the name.) Autodesk president Eric Herr assumes the added responsibilities of acting GM of Discreet until the company fills the position. Discreet Logic president/ CEO Richard Szalwinski will assume an advisory role.
The brand name Kinetix will be discontinued. Other than that, there are currently no plans to change the names or stop development of any existing products, Herr said. He added that customer support for Discreet products would remain intact.
This is about expansion, Herr said of the acquisition. There should be more products, more price points, hopefully more revenue. He added that the company also intends to maximize the synergies between the two companies by improving interoperability between the products.
More specifically, Herr said, We want to accelerate innovation at the high end. … This is about breaking new ground. He commented, We would love a 500 percent increase in R&D [during the next four or five years]. Then we will be able … to really meet our expectations.
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Longtime Discreet Logic customer Phil Price, president/creative director of Click 3X New York, with additional offices in Atlanta, San Francisco and Santa Monica, viewed the acquisition as positive for Discreet. It shows the future, which is in growth, he said. The visual effects market is not going to show the kind of growth [they need] in terms of film and TV products. Their future is in selling a lot more, smaller equipment. I think they realize that and they are trying to leverage the market [by migrating] cross platform into a more broad-based market. The acquisition allows them to do that.
He added, though, that he hopes Discreet will not grow more distant from its customers as a result of the acquisition.
Another Discreet customer, Michel Suissa, VP/creative director, New York-based Black Logic (formerly Tape House Digital) was a little wary, but hopeful. Im always a little on the skeptical side whenever there is a merger of a company that was very client-oriented, like Discreet, with a larger company, he said. However, it seems Discreets NT products fit well into Autodesks line and might find a good synergy. He suggested that the backing of the larger company would give Discreet products more flexibility with R&D; thats what I hope.
Autodesk and Discreet are scheduled to exhibit in one booth at the upcoming NAB convention this April in Las Vegas. Herr said there would be more information on Autodesks plans at that time.
