Following Discreet Logic Inc’s failure to acquire MGI Software Corp earlier this year (CI No 3,427), Discreet itself has agreed to be acquired by CAD/CAM software giant Autodesk Inc. The deal will be worth some $520m to Discreet shareholders, based on the August 19 share price. San Rafael, California-based Autodesk says the move is part of its plan to broaden its business away from the its traditional design software category, something it began in 1996 with the formation of Kinetix Inc as a separate multimedia software division (CI No 2,909). Discreet’s founder and chief executive officer, Richard Szalwinski, who had planned to vacate the CEO position at Discreet and stay on only as chairman, will instead head up the Discreet division of Autodesk. The division will stay in Montreal, Canada, from where Discreet’s turnkey editing and broadcasting products for the film and broadcasting industries will continue to be developed and sold. Those products include Inferno and Flame, along with various visual effects toolsets. In San Francisco, a new media group will be set up, combining Discreet’s Effect, Paint and Light desktop nonlinear editing products with Kinetix’s 3D Studio Max, running on standard Windows NT-based hardware. Autodesk says it began discussions with Discreet 16 months ago in areas such as content creation and digital imaging, and since then has announced a series of initiatives for two way integration between Kinetix and Discreet products. Discreet has 350 staff. Autodesk says there is very little overlap, and says its sales, distribution and marketing set-up will be added to Discreet’s technical strengths. Under the terms of the agreement, Autodesk will issue 0.525 shares of common stock for each outstanding share of Discreet Logic stock, accounting for the transaction as a pooling of interests. The acquisition follows Avid Technology Inc’s purchase of Microsoft Corp’s Softimage Inc subsidiary for $285m back in June (CI No 3,432).
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