Turtle Beach Corporation (HEAR - Free Report) has completed the acquisition of ROCCAT — a leading German PC peripherals company — for $15.6 million in cash plus up to $3.3 million in earnout payments.
The strategic move marks the beginning of the next phase in the audio technology company’s expansion into the $2.9 billion market for PC gaming headsets, mice and keyboards. This is considered to be a major step in its goal of building $100 million PC gaming accessories business in the coming years.
The newly combined product portfolio is likely to be one of the strongest in the industry. It now features around 50 current core product models across PC gaming mice and keyboards, PC gaming headsets, and console gaming headsets. Also, the enhanced distribution channels across North America, Europe and Asia, enables the company to deliver its lineup of leading-edge products to more gamers around the world.
ROCCAT’s expertise will likely help accelerate Turtle Beach’s expansion into the nearly $1.6 billion PC gaming headset market and $1.3 billion PC gaming keyboard and mice market. Turtle Beach intends to expand from being the leader in console gaming headsets into becoming a top gaming accessory brand for all platforms.
Turtle Beach has long-term EPS growth expectation of 9%. The company expects revenues from ROCCAT products to be more than $30 million in 2020, and the buyout to be accretive to its net income and EPS in 2020.
Additionally, the company is well positioned to benefit from solid product performance, excellent market position coupled with market share expansion, driven by innovation, quality products, strong brand and retail partnerships.
Other players in the industry include Knowles Corp. (KN - Free Report) , Altice USA, Inc. (ATUS - Free Report) and Arista Networks, Inc. (ANET - Free Report) .
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