Control & Automation

WAVE Electronics Acquired by Kingswood Capital, Merges with AVAD

WAVE principal Mark Fukuda named CEO of new home-technology mega distributor after Kingswood Capital acquires the Houston-based company and merges it with AVAD LLC.

WAVE Electronics Acquired by Kingswood Capital, Merges with AVAD
Via an acquisition by Kings Capital, WAVE Electronics and AVAD are merging into a giant distributor of audio, video and home automation products.

Julie Jacobson · October 3, 2018

WAVE Electronics and AVAD, two big home-technology distributors with a combined 32 branch locations in the U.S. and Canada, have merged. Kingswood Capital Management, the private equity firm that acquired AVAD in 2016, have now acquired WAVE for an undisclosed amount.

"In bringing together WAVE and AVAD, Kingswood will create the single largest value-added distributor of high-end audio, video, security, and home automation solutions in the consumer electronics industry," Kingwood states in a press release announcing the acquisition.

Both AVAD and WAVE have been on a tear over the past few years, expanding branch locations throughout North America. In June 2017, AVAD announced 11 new branch openings. And it was only six years ago that Houston-based WAVE abandoned its national distribution network, PowerHouse Alliance, to go national on its own. The group now has 12 branches, mostly in Texas and Louisiana, but also stretching to California, Florida and New Jersey.

WAVE president Mark Fukuda, who joined the company in 2006, will be the new CEO of the merged distribution group. WAVE was founded in 2002. AVAD, formerly a collection of independent regional distributors, was acquired by Ingram Micro in 2005 for more than $120 million.

CE Pro will have more details about the deal soon.

Check out more M&A deals in the home-tech sector this year.

The press release is below.

PRESS RELEASE

Kingswood Capital Completes Acquisition of WAVE Electronics, Announces Merger with AVAD

Kingswood Capital Management, LLC (together with its affiliates, “Kingswood”), an operationally-focused lower-middle market private equity firm, announced today that it has acquired Houston, Texas-based WAVE Electronics, Inc (“WAVE”). Kingswood will merge WAVE with its portfolio company, AVAD LLC (“AVAD”). In bringing together WAVE and AVAD, Kingswood will create the single largest value-added distributor of high-end audio, video, security, and home automation solutions in the consumer electronics industry. The new Company will be focused on the residential and commercial custom installation markets in North America. The combination of WAVE and AVAD delivers a far-reaching benchmark solution to elevate same-day product needs, national one-day shipping, and award-winning services for dealers and vendors across the United States and Canada.

At Closing, Mark Fukuda, former Chief Operating Officer for WAVE, will take over as the Chief Executive Officer for the combined new enterprise. Key members of the new Executive Management team will include Bill Steckel as Chief Finance Officer, Ainslie Fukuda as Vice President of Purchasing, Bryan Stewart as Vice President of Sales, and Jon Zabel as Vice President of Vendor Management.

The new Company will be headquartered in Houston, TX with an initial objective to combine the best residential A/V, Pro A/V, and security brands across all of its North American locations. The new Company plans to integrate its award-winning dealer services, including tech support, programming services, marketing services, and dealer programs. Mark Fukuda added, “Both AVAD and WAVE have spent years perfecting the just-in-time distribution model and this rapidly accelerates our ability to bring our award-winning service and product solutions to dealers throughout the United States and Canada. AVAD has built a strong presence in the pro A/V channel, WAVE has done the same in the residential security space, combining that with our collective strength in the residential A/V markets and our new larger North American footprint is a winning combination.”

Tom Jacoby, who had been serving as AVAD’s Chief Executive Officer and who will become Chairman of the combined Company, added, “Fred Farrar and I have spent the last two years at AVAD positioning the company for exactly this kind of market expansion opportunity.  We are very grateful to the AVAD team, which has worked diligently over the past couple years to position the company for profitable growth following the carve-out from Ingram Micro in 2016.  The WAVE leadership team has built great operating systems and developed transformational segment opportunities that make it natural for Mark Fukuda to assume leadership of the combined business.

Alex Wolf, Managing Partner of Kingswood, commented, “The merger of WAVE and AVAD provides for a unique combination of scale and diversification in the North American custom-installer channel. The combination of WAVE and AVAD creates a multitude of growth opportunities from a wide base of 31 different physical locations. Industry integrators will have access to an industry-leading line card at more locations than ever before.”

Dentons US LLP and Goodwin Proctor LLP served as legal advisors to Kingswood.  Stephens Inc. acted as the exclusive financial advisor to WAVE.

About Kingswood Capital Management

Kingswood (http://kingswood-capital.com/) is an operationally-focused lower-middle market private equity firm that invests in businesses in transition driven by operational, strategic, financial or market-driven change.  In addition to access to capital, Kingswood brings a broad network of operational resources, relevant industry relationships and tailored solutions to strengthen businesses, realize strategic goals and enhance long-term value creation.

About WAVE Electronics

Founded by Gary Wermuth, WAVE Electronics’ corporate offices are located in Houston, Texas. WAVE, the leader in home automation distribution, services local and national dealers across multiple channels of business that include residential/commercial A/V, and security. WAVE is recognized as the "one-stop" solution with over 8,000 stock items from 126 premium manufacturers. WAVE locations incorporate training facilities extensively merchandised showrooms for dealers to use as their own. WAVE also goes the extra mile by offering a broad variety of services to their dealers which include: same day delivery, one day shipping, sales and product trainings, marketing services, 24/7 online shopping, and much more.

About AVAD, LLC

AVAD is one of the most recognized brands in the fast-growing system integration market. AVAD offers a comprehensive line of premium solutions for video, audio, networking, HVAC, lighting control, security, home automation, digital signage, system design and other products needed by professional installers. Further differentiating its services, AVAD invests in the business tools, technical support and services that integrators need to grow their businesses, including the fully transactional AVAD Mobile smartphone application providing integrators on-the-go access to AVAD products and value-added tools.



  About the Author

Julie Jacobson, recipient of the 2014 CEA TechHome Leadership Award, is co-founder of EH Publishing, producer of CE Pro, Electronic House, Commercial Integrator, Security Sales and other leading technology publications. She currently spends most of her time writing for CE Pro in the areas of home automation, security, networked A/V and the business of home systems integration. Julie majored in Economics at the University of Michigan, spent a year abroad at Cambridge University, earned an MBA from the University of Texas at Austin, and has never taken a journalism class in her life. She's a washed-up Ultimate Frisbee player currently residing in Carlsbad, Calif. Email Julie at jjacobson@ehpub.com

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  Article Topics


Control & Automation · Business · News · AVAD · Distributor · Mergers and Acquisitions · WAVE · All Topics
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Comments

Posted by Julie Jacobson on October 4, 2018

bobplotkin, are you in touch with your original installer? Please email me directly jjacobson@ehpub.com. thx

Posted by bobplotkin on October 4, 2018

Could someone explain to me the real facts of my Control4 & Alexa problem ?
When we built our new home 3 years ago, I had a complete Control4 home Automation System professionally installed. I now find myself with two issues:
1) My Amazon Alexa’s & Dots can no longer access my Control4 devices. They worked perfectly for over the last 2 1/2 years until Amazon update their IP protocol - Do I have to change to IR Control or will Control4 ever coordinate this issue with Amazon ?
2) I no longer have computer access to my 12 IP Security Cameras and my 2 TPZ cameras via my Control4 System due to the Apple Safari update to 12.0.
Will Control4 ever coordinate this issue with Apple ?
( This is what I have been advised by my Control4 professional that installed my system.
Any information on these issues will be gratefully appreciated ! Thanks !

Posted by WWTech on October 3, 2018

Sad news. AVAD is a shell of it’s former self, so this does not bode well for WAVE or the combined company (WAVAD anyone?).

Posted by WWTech on October 3, 2018

Sad news. AVAD is a shell of it’s former self, so this does not bode well for WAVE or the combined company (WAVAD anyone?).

Posted by bobplotkin on October 4, 2018

Could someone explain to me the real facts of my Control4 & Alexa problem ?
When we built our new home 3 years ago, I had a complete Control4 home Automation System professionally installed. I now find myself with two issues:
1) My Amazon Alexa’s & Dots can no longer access my Control4 devices. They worked perfectly for over the last 2 1/2 years until Amazon update their IP protocol - Do I have to change to IR Control or will Control4 ever coordinate this issue with Amazon ?
2) I no longer have computer access to my 12 IP Security Cameras and my 2 TPZ cameras via my Control4 System due to the Apple Safari update to 12.0.
Will Control4 ever coordinate this issue with Apple ?
( This is what I have been advised by my Control4 professional that installed my system.
Any information on these issues will be gratefully appreciated ! Thanks !

Posted by Julie Jacobson on October 4, 2018

bobplotkin, are you in touch with your original installer? Please email me directly jjacobson@ehpub.com. thx