Quantel’s surprise acquisition of Snell has created a UK broadcast technology giant with annual revenues of just over £100m and a combined R&D spend of £18m.

Although the two brands will remain, their manufacturing, marketing and sales teams will be combined at Quantel’s Newbury facility, which is just 20 miles away from Snell’s Reading HQ.

The newly merged company will have a workforce of 680.

“By this time next year, we want all manufacturing to be in Newbury, so we can be super-efficient,” said Quantel director of marketing Steve Owen.

Quantel manufactures news and sport production systems such as Enterprise SQ, as well as postproduction finishing tools like Pablo. Snell is known for products such as its Ice channel-in-a-box playout platform, Kahuna production switchers and Alchemist conversion system.

The firms, which are both backed by Lloyds Development Capital, are set to integrate some of their products.

Owen raised the prospect of Snell’s conversion technology being used in Quantel’s IP-based workflow system QTube, while Snell’s Momentum asset management system could be used with Quantel’s news and sport production tools.

“Snell also has expertise in IP as a replacement for SDI, while Quantel recently made an interesting submission to SMPTE on future networking, so we are likely to see exciting stuff from both on that front,” said Owen.

He added that Quantel had been looking to make an acquisition for a couple of years but had only entered serious negotiations with Snell in the past three months.

He said Snell’s product range, culture, values and geography were essential to the deal.

“You couldn’t find two businesses with more complementary product sets.

“With some acquisitions you can end up with less than the sum of the parts, but in this case, one plus one genuinely does equal two.”

Over the past couple of years, Quantel has introduced colour-correction system Pablo Rio, which runs on commercial, off-the-shelf hardware, and Revolution Q media production software, which runs on generic storage.

According to its last set of results, 2012 was a “difficult year” for Quantel Ltd due to weaker demand in core markets in Europe.

The overall Quantel group made a profit of £21,000 for the 15 months to December 2012.

However, the move from hardware to software did lead to an increase in gross margins and Owen said sales of Pablo Rio grew 44% year on year in 2013.

Snell began to shift away from hardware last year when it made its image-processing kit available as software tools.

It made a profit after tax of £5.7m in 2012, with “strong growth” in its TV everywhere business.

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