Dolby Laboratories To Acquire GE Licensing In $429M Cash Deal: Strengthens Patent Portfolio

Zinger Key Points
  • The acquisition is an extension of Dolby's existing licensing businesses.
  • Acquisition includes over 5,000 patents, including foundational patents in standard essential video compression.

Dolby Laboratories, Inc. DLB, known for its entertainment services, announced a definitive agreement to acquire GE Aerospace’s GE GE Licensing, which specializes in intellectual property licensing in the consumer digital media and electronics sectors.

Dolby Laboratories will acquire GE Licensing in a $429 million all-cash transaction, expected to close by the end of fiscal year 2024.

The deal involves over 5,000 patents, including key patents in video compression technology. This acquisition will bolster Dolby’s patent portfolio, enhancing its standing in the industry.

GE Aerospace will retain its portfolio of IP related to its core aerospace and defense technologies, as well as the trademark portfolio for the GE brand.

GE Licensing is recognized for its innovations and patents, particularly in video codec technology. Andy Sherman, Dolby’s Executive Vice President, Patent Licensing and General Counsel, emphasized the strategic importance of this acquisition for Dolby’s commitment to open standards and collaborative licensing.

Robert Giglietti, CEO of Corporate Holdings and Treasurer at GE Aerospace, stated, “As GE Aerospace continues to sharpen its focus as a standalone company serving aerospace and defense customers, Dolby is the right partner for ensuring these innovative digital media technologies continue to serve businesses and consumers around the world.”

The deal, which awaits regulatory approval, will not significantly impact Dolby’s fiscal 2024 results. Dolby anticipates the acquisition to be accretive to operating margins and EPS on a non-GAAP basis in fiscal 2025.

Dolby held $824.4 million in cash and equivalents as of March 29, 2024.

The transaction includes complementary assets that enhance Dolby’s patent portfolios and will not alter Dolby’s policy of returning capital to shareholders through quarterly dividends and stock repurchases to counterbalance dilution from stock-based compensation.

Price Action: DLB shares are trading higher by 0.14% at $80.07 at the last check Thursday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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