Leading computer peripherals company, Logitech LOGI, completed the acquisition of Mad Catz Interactive, Inc.’s MCZ Saitek product portfolio for $13 million in cash. This buyout reflects the company’s strategy to fortify its Logitech G gaming product line.
Saitek Under Logitech's Wing
In particular, Logitech has acquired Mad Catz Interactive’s Saitek brand along with the Saitek line of flight, space and farm simulation game controllers. Mad Catz’s divested assets comprise specified trademarks, equipment & tooling, inventory and technical data. It also includes every other element required to design, market and distribute Saitek brand’s interactive simulation controllers.
Mad Catz is in the midst of a portfolio-pruning drive to optimize growth. The company believes that divesting the Saitek portfolio will enable it to channelize resources to key growth areas, namely Mad Catz and Tritton video game accessories and headset brands. The company expects that Logitech’s profound expertise will aid Saitek in scaling new heights within the flight-simulation community.
Buyout Conducive to Logitech G gaming
Though Logitech has clarified that the Saitek buyout will not have a material impact on its quarterly or full-year financial results, there is no denying the fact that it will fortify the company’s position in the gaming domain. Logitech’s gaming business has emerged as one of its strongest growth drivers.
During first-quarter fiscal 2017, it continued charting its robust growth trajectory and was up 29%, benefiting from product launches, marketing initiatives and growing trend of PC gaming in Asia-Pacific. The company expects the momentum in its Gaming category to continue in the quarters ahead on the back of a solid product portfolio. In this regard, the Saitek takeover will clearly boost the Logitech G gaming product portfolio, including G29 and G920 Driving Force steering wheels.
Logitech currently sports a Zacks Rank #1 (Strong Buy). Investors may also consider other favorably placed stocks like Identiv Inc. INVE and Alps Electric Co Ltd APELY, both of which carry the Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Interested in IPOs? Check out the special edition of Zacks Friday Finish Line below, where Editor Maddy Johnson and Content Writer Ryan McQueeney interview Kathleen Smith of Renaissance Capital about the IPO market in 2016 (see part two here).
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