Spotlight on InfoComm 2019


Panduit Acquires Atlona to Create More Complete Solution for Customers

Atlona will achieve expanded global reach as part of acquisition by Chicago-area $1B global networking solutions provider.

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Ilya Khayn and brother Michael Khain took Atlona about as far as they could in their 15 years of stewardship, but they knew for the company to truly achieve the global reach they envisioned, they needed to find some help. That’s why Khayn and Khain sold Atlona to Panduit.

Through the acquisition, Atlona’s family of networked AV, signal distribution, wireless collaboration and AV system automation products will join Panduit’s ecosystem of network infrastructure solutions in a marriage both sides believe will only serve to help their customers.

“What we were missing was ability to create enough awareness and go deep into the channel,” co-founder and CEO Ilya Khayn told CI in an interview about the deal. “It’s a decision that doesn’t come easy.

“My brother Michael and I built Atlona pretty much from scratch for the past 15 years. This was not only the best commercial opportunity, but the best opportunity for the legacy of the company.

“There are strong synergies between our companies including a culture of providing innovative, high-quality, customer-driven products, along with outstanding customer support capabilities. This partnership will ultimately provide our market channels with a single-source solution and expand our footprint globally,” he says.

CI Coverage of Atlona Through the Years

Atlona Joins Panduit Family

The Atlona team will join Panduit’s enterprise business group as part of the deal. Atlona will remain based in San Jose, Calif., for all sales, customer support and training needs while Panduit’s global hub is in Tinley Park, Ill., a suburb of Chicago.

“We’ve been working on a strategy to expand into the AV space,” says Panduit VP of enterprise business Thomas Kelly. “We’ve been seeing the convergence of AV onto the network and this will help to ensure that our contractors and end users are able to deploy solutions for the complete network.”

“We’ve been working on a strategy to expand into the AV space,” says Panduit VP of enterprise business Thomas Kelly.

“We’ve been seeing the convergence of AV onto the network and this will help to ensure that our contractors and end users are able to deploy solutions for the complete network.”

Panduit officials first started talking to Atlona about two years ago about creating an OEM solution, says Kelly, but talks progressed over time to a focus on a strategic acquisition that allows Atlona to operated as part of the Panduit family.

“We’re confident we can use our global footprint to scale Atlona’s growth and accelerate what they’ve built over the last 15 years,” says Kelly. “We felt common culture with Atlona and a common focus on innovation. We’re both trying to make complicated things simple for our customers.”

Atlona brings to Panduit “a solution we didn’t offer,” which is what made them attractive, he says.

“As the market continues to converge, we wanted to be able to participate in that in a deeper way than we have in the past,” says Kelly. “We’ve had customers asking us for more active solutions. There’s also a common culture and mindset between Panduit and Atlona to capitalize on complementary growth opportunities.

“We were looking for an opportunity to gain exposure through AV over IP and we were blown away by Atlona’s solution. It felt very open and supportive from the beginning. There were no hidden agendas.

“That’s an area where this acquisition has excelled. It makes us very optimistic for the future. We had an aggressive timeline, but everyone pulled together and everything fell into place. I’m confident that’s going to result in some sales growth for us,” he says.

“Atlona has been at the forefront in developing cutting-edge AV technology that embraces the full potential of the convergence of AV and network infrastructure,” said Dennis Renaud, president and CEO of Panduit, in the joint press release announcing the deal on Jan. 21.

“Their industry-leading solutions complement Panduit’s extensive physical infrastructure portfolio, which will allow us to offer customers a quality end-to-end solution as they move to increasingly complex network infrastructure systems.”

Panduit

Atlona becomes a Panduit company in a joint meeting at the Atlona headquarters in San Jose, Calif. Pictured are (left to right) Marc Naese, Panduit senior VP of network infrastructure business; Dennis Renaud, Panduit CEO; Ilya Khayn, Atlona CEO and co-founder; Michael Khain, Atlona VP of product development and engineering and co-founder

Bigger Opportunities for Everyone

As part of the acquisition, sales staffers will share leads to help the parent company realize bigger opportunities, he says.

Khayn and his brother got several overtures about Atlona from private equity firms, competitors in the pro AV space and of course from Panduit, which came with the promise of keeping Atlona as its own independent business unit.

“Now we can stay very nimble and focus on the AV channel more than ever—and we’re able to tap into a lot more resources,” says Atlona’s Ilya Khayn. “It’s going to enable our customers and our employees to grow.

“Now we can stay very nimble and focus on the AV channel more than ever—and we’re able to tap into a lot more resources,” says Khayn. “It’s going to enable our customers and our employees to grow.

“There are a lot of great synergies between the companies and this will give us a higher level of service and allows us to elevate our level of engineering service and escalate and develop products more quickly.

“This was a very important decision for us. We were very impressed throughout the process and felt it was a very collaborative environment. There was good synergy across the board,” he says.

Kelly is pleased with how the process went and understands Panduit’s fourth acquisition is about more than increasing the bottom line for either side.

“At the end of the day, it comes down to the people,” he says. We want to make sure both teams are able to collaborate and communicate. That’s where you’re going to be successful. Our success is really going to come from our shared vision, our mindset, our focus on the customer.”

Panduit’s Acquisition Process

Atlona marks the fourth acquisition for Panduit, says Kelly. In the previous three deals, Panduit leadership “overemphasized back-end integration that didn’t help our profit model,” he says.

This time around, “we’re focused in year one on growing our revenue and allowing the sales teams to cross-sell and deliver a stronger message than they could in the past. We’re not immediately focused on integration efforts.

“We really search out levels of strategic acquisitions. They’re all driven by a connection to business strategy and the growth we see as a result of the acquisition. We should be putting our effort where customer receives benefit and let other things happen when then happen. Our biggest opportunity is to pass leads between the two sales organizations,” he says.

Kelly isn’t sure if Panduit will add another AV company to the fold in the future.

“It depends on the level of strategic fit,” he says. “We don’t have an immediate appetite to do more than this. We’re in it to grow and solve problems for our customers. If that means another strategic acquisition, we would certainly entertain that.”

Khayn knows AV is “definitely a very attractive category,” adding he “envision[s] a lot more mergers and acquisitions in the next several years.” Khayn was particularly interested in joining the Panduit team because there’s no overlap between the companies.

Atlona and Panduit officials spent the past six months talking and working together, says Khayn.

Starting with BICSI in Orlando this week and ISE 2019 in Amsterdam next month, Atlona and Panduit will work for the next six months or so “to create excitement and awareness,” he says.

Panduit