Native Instruments Moving Towards Insolvency, Looking For Buyers
Early this year, Native Instruments was involved in preliminary insolvency proceedings, it caused understandable concern among the company’s base of users.
As the developers of Maschine, Kontakt, Reaktor and Traktor, NI is responsible for multiple product lines that musicians rely on day-to-day. Were support to be pulled for these, it would have a major impact not only on users – many who have also invested in system-specific hardware – but on third parties producing sample instruments designed to run within Kontakt’s much-used ecosystem.
Native Instruments is also the parent company of software brands iZotope, Brainworx and Plugin Alliance, whose plugins – particularly in the case of iZotope – are widely used by producers and audio professionals.
Nick Williams, CEO of Native Instruments
Nick Williams, CEO of Native Instruments today shared an update on the company’s ‘restructuring process’.
Native filed for “preliminary insolvency” in January of this year. This meant that a government-appointed administrator would be working with the company to protect debtors’ assets, and to see if changes could be made to enable a company to stabilize its financial situation.
In it, Williams thanks NI users and partners for their support, and reiterates that, “Business continues as usual across Native Instruments, iZotope, Plugin Alliance, and Brainworx. Our products, platforms, services, downloads, and customer service remain fully available.”
The statement continues with an update on the mergers and acquisitions (M&A) process, confirming the widely-assumed fact that a buyer is being sought for Native Instruments, either in whole or parts:
“We are currently in an active M&A process that is progressing well, with strong interest from multiple parties with deep roots in audio and technology,” Williams writes. “We see a clear path to achieve our goal to provide continuity for creators, customers, and partners.”
As part of the restructuring process, Native Instruments GmbH and a number of our German entities will shortly be moving through expected legal steps, including transitioning from ‘preliminary insolvency’ into formal ‘insolvency’ proceedings where applicable. These are expected steps in the process we are working through.
The reference to German entities here appears to align with a comment made on Facebook in January by Plugin Alliance General Manager Mo Volans, which stated that, “As of today, Plugin Alliance entities are not part of the insolvency filing. Our operations in Langenfeld and the US remain outside these proceedings.”
iZotope is based in Boston and operates as Native Instruments USA, Inc.
It’s striking that NI has moved so quickly from dominating the world of electronic music and buying up other companies, to looking for buyers.
“The failure of Native Instruments is a complicated story, worthy of a full-length case study,” notes Music Trades Editor Brian T. Majeski, adding that “Misplaced growth expectations, poor product development, and a healthy dose of hubris surely contributed.”
Native’s products are still essential for many musicians, so the outcome of their insolvency will have a huge impact on the future of electronic music making.
Read the statement from Native Instruments CEO Nick Williams in full below:
“I want to share a direct update on the restructuring process underway here at Native Instruments. Business continues as usual across Native Instruments, iZotope, Plugin Alliance, and Brainworx. Our products, platforms, services, downloads, and customer service remain fully available.
“The support we are receiving from our partners, artists, and community has been extraordinary. This loyalty isn’t something we take for granted, and it’s a reflection of what Native Instruments means to the people and businesses we work with every day.
“At the end of January I said: “We are working diligently and responsibly to secure a healthy, financially sustainable future for Native Instruments.” This remains true – and our determination to achieve a sustainable future is strengthened and energised by your support.
“We are currently in an active M&A process that is progressing well, with strong interest from multiple parties with deep roots in audio and technology. We see a clear path to achieve our goal to provide continuity for creators, customers, and partners.
“As part of the restructuring process, Native Instruments GmbH and a number of our German entities will shortly be moving through expected legal steps, including transitioning from “preliminary insolvency” into formal “insolvency” proceedings where applicable. These are expected steps in the process we are working through.“What gives me confidence in our future isn’t just the progress we’re making – it’s also the extraordinary passion and dedication of the entire team here at Native Instruments. We continue to deliver every day, building and shipping products, and looking after our customers.
“We’ll continue to share significant updates as we have them.”
