Are Marantz and Bowers & Wilkens becoming pawns in Masimo's internal fight?


Last year I decided to add Masimo (MASI) to my play money investment portfolio and the latest batch of communications from the MASI board are an entertaining read; a soap opera of internal fighting, CEO lavish spending and allegations of director incompetence. 

As you might already know from previous threads Masimo is the owner of Sound United (Marantz, Bowers and Wilkins, Harmon Kardon, etc).  These brands have changed hands many times from their original owners and founders.  Historically, the new owners brought much needed cash and allowed them to operate as independent entities.

From the outset it was questionable as to why Masimo; a predominantly health care device company would want consumer electronics, but they did announce some advancements with B&W and hearing assistance products.  Also, it wasn't clear how much independence Masimo would continue to allow these consumer electronics brands to have.

Where is it at today?  As major investor in Masimo, Politan LLC wants the CEO out.  He's alleged to have spent too much corporate money on a G550 private jet and trips to points like Santa Barbara 😉, and to have allowed the main company brands and Sound United brands to underperform the market substantially.  Since being acquired by Masimo, Sound United revenue is down as much as 49%.

The future; the CEO has proposed leaving Masimo for a big buyout and wants to take Sound United with him.  Not sure if that would be better for Marantz and B&W or just to spin them off one by one.  Anyone out there with a desire to buy a consumer electronics company(s) and a lot of extra cash?  It may be the only way to save Marantz and B&W.

 

128x128socalml528

I care about Marantz. If Denon, B&W, H.Kardon, etc go down the drain, I wouldn't care.

The CEO does look like one of those deadweights who spends a lot on hookers and cocaine.

Interesting thread, even if no one is participating in it.  I haven’t bought a Denon or Marantz component in years but I can’t see how letting these companies atrophy due to corporate greed is a good thing for audio

socalml528

Masimo is the owner of Sound United (Marantz, Bowers and Wilkins, Harmon Kardon, etc).

You are mistaken that Masimo owns Harmon Kardon. HK is owned by Samsung.

I looked into investing in Masimo and walked away. The P/E ratio alone is inexplicably high for a company is such a huge mess. The outcome is anyone’s guess.

I think there’s few comments because I offered a poorly constructed question. My interest in this topic and Masimo was partly past experience consulting at a medical device company and wondering if the marriage of medical devices and consumer electronics could work? Second, once I started receiving investment documents I realized that Masimo was in the middle of very public war between the CEO and a major investor. The battle for the board of directors was taking place in conflicting voting recommendations and disparaging comments sent to all investors. Even those with just a few shares (for curiosity not real investing).

Ultimately, the larger topic is how will the brands we all love and sometimes disappoint us survive and continue to innovate. I don’t see "go it alone" as viable for many, even McIntosh Group is now a conglomerate with Sonus Faber and Sumiko under one roof. No predictions here; just wondering and typing smiley