Mid/high end separates advice (1 Viewer)

[ling_w]

So for $2 million, Dan will hand over his whole company to Harman International? That sounds like some crooked convertible bond issuing to me.

 

[AjayM]

Yea sounds kinda funny, $2M for a company the size of Krell (which has a good distribution chain, a high end image, and what are probably pretty strong sales numbers) just seems to low of a number for somebody to take over the company.

Andrew

 

[Brandon Blair]

I'm not 100% sure, but i don't think they get the entire company for the $2 million, but if Krell doesn't pay off the $2 million loan in a certain time frame then they will be required to sell off the rest of the company to Harmon Kardon (for whatever price its worth).

 

[AjayM]

Well it sounds fishy, in the business world $2M just isn't a whole lot of money, especially for a company that has the brand name and image like Krell does. And to top it off the kind of deal you described is kinda off a little as well, it's the kind of deal somebody would take if they had absolutly no business sense at all.

And to say the company is in serious financial trouble because they took out a $2M loan is a stretching things just a bit, companies take out loans all the time to further their business, and considering the make overs that Krell has done to their model lineup (the whole lower end lineup has been changed, and new models introduced) it's not that much of a stretch.

So I dunno, sounds more like a rumor than anything...or maybe you overheard something and didn't get all the details (or you didn't post them all)...or maybe it's all true, I mean the economy hasn't been the best (although the higher end luxury stuff didn't take a big hit like most people thought), mix that with a couple of unwise decisions and things can happen quickly.

Andrew

 

[ling_w]

Yeah, it doesn't make sense. Unless Krell's financial situation was so bad that they couldn't get normal loan from a financial institution and had to crawl to these loan sharks.

 

[AjayM]

It's not even so much as getting a normal loan from a bank, but just from an investment standpoint, I don't think it would be that hard to find angel/bridge loan investment money for a company like Krell....unless as you said they were in such horrible financial trouble that nobody would touch them (but companies in that kind of trouble usually don't revamp their whole lower lineup).

The problem with Krell being private is that none of thier financial information is around in the public domain. I quick looksie through Harmon's SEC filings didn't find anything about Krell (a $2M loan is pretty sizable in the SEC's eyes and would/should be listed in some SEC filing), but not knowing when they posted the loan it's a little hard to find (but searching through news reports nothing came up).

Andrew

 

[Justin Doring]

$2 million doesn't strike me as a particularly large sum of money, even for a small company like Krell. I bet Dan D'Agostino's yearly salary is probably close to that.

Harman International taking over Krell would be very strange indeed. I wonder if they’d simply close the business and retire the name in order to eliminate competition for their high-end Mark Levinson division, which makes better gear than Krell anyway.

 

[AjayM]

$2 million doesn't strike me as a particularly large sum of money, even for a small company like Krell. I bet Dan D'Agostino's yearly salary is probably close to that.

Harman International taking over Krell would be very strange indeed. I wonder if they’d simply close the business and retire the name in order to eliminate competition for their high-end Mark Levinson division, which makes better gear than Krell anyway.

Well I doubt Dan is taking home $2M, but I'm sure he's living comfortably, although if his company is in severe financial trouble then that changes things immensly.

I'd predict that if all of this is true, and if Harmon would take it over, I bet they would keep the brand around (it's a different kind of competition in the market place when the same head company owns both brands), plus Krell has some interesting sales channels that Levinson doesn't like Sound Advice (mostly a Florida, SE-USA chain of stores). Plus Levinson doesn't have a lower line like Krell has (the HTS, KAV stuff).

As to Jon's original question, the Krell Showcase is an unknown in terms of performance, but it certainly looks attractive in terms of specs. The Theta is always a well reviewed unit, ditto for the Integra. Honestly I don't think you can go wrong with any of them. As to amps, I wouldn't be concerned about matching them brand for brand with the pre-pro, for instance I think there are probably better value's to be had than say the Integra amp.

Andrew

 

[Jon SS]

Thanks again guys.

I was comparing the Krell Showcase pre-pro to the Integra RDC-7 and I think what appealed to me was that Integra's upgrades will probably be a lot cheaper than Krell's. I think their HTS2 upgrade to 7.1 was $1,500.

I am also trying to find out from Theta how much their base Casablanca costs and what you get. I know it will be a lot more that the Integra and Krell above but may be worth it.

I still have to listen to them all but based on all these comments (and other forums) matching the Integra to the Dreadnaught may be a good way to go.