by Alyssa Oursler | August 14, 2013 1:03 pm
Bands across the musical spectrum are often accused of “selling out,” but today those ranks were joined by an old-school piano-maker.
Steinway (LVB[1]) — which was founded in 1853 and sells artisan-crafted pianos around the world — was sold to hedge fund manager John Paulson for $512 million.
Steinway has been on the brink of a deal for some time — as seen in the 94% run-up in share so far this year. In fact, it originally planned to stay within the music space, and sell itself to Kohlberg & Co. for $35 per share.
Paulson beat that — and a more recent bid from South Korea’s Samick Musical Instruments Co. — with $40-per-share offer.
But while Steinway was, in hindsight, a great investment year-to-date, don’t look to the rest of the music space for an encore. The only real options remaining are thinly traded ADRs like the $13 million Singing Machine Company (SMDM[2]) and instrument-maker Yamaha Corp. (YAMCY[3]).
No, if you want music, you’re better off sticking with the consumer-focused companiesthat steal the spotlight. Tech giant Apple (AAPL[4]) comes to mind thanks to its iTunes service, along with streaming and satellite providers like SiriusXM (SIRI[5]) and Pandora (P[6]).
Though they hardly evoke the same sentiment as you’ll get from handmade, rich-sounding pianos.
As of this writing, Alyssa Oursler did not own a position in any of the aforementioned securities.
Source URL: https://investorplace.com/2013/08/music-actually-sells-out-today-with-steinway/
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