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Razer acquires audiovisual icon THX as it explores growth beyond the games industry

Razer, the company that develops hardware and services for gamers and the world of gaming, has made an acquisition to catapult it to more platforms and more people: The company has acquired THX, the legendary audio and video quality assurance company that was originally founded by George Lucas as part of Lucasfilm.

Razer’s CEO Min-Liang Tan said in an interview that the terms of the deal are not being disclosed. But as part of the purchase, 33-year-old THX will be “spun out” and operated as a “startup,” recapitalized by Razer; run independently of it under existing management, led by Ty Ahmad-Taylor out of San Francisco; and focusing on developing new things.

Currently, THX employs 50 people, including a number of top audio and graphics engineers and scientists; the plan will be to ramp up those numbers both at the HQ and in other offices in countries like China to tap into the growing market there for films, tech and any other content that could be improved with better audiovisual quality.

THX has been through a few ownership phases since being founded in 1983, and the only one of those where a price was publicly attached to the company was when Creative Technologies, a Singaporean company, acquired a 60 percent stake from Lucasfilm reportedly for $8 million in 2002, implying a valuation of a mere $13 million.

That price was never confirmed, and when I mentioned it to Min, as Tan is known, all I got in response was: “2002 is not today,” and a laugh. (By the time of the Razer acquisition, Min said that Creative Technologies no longer was the majority owner; a PE firm was. Min declined to give specifics about the shareholders involved.)

Razer itself has disclosed at least $125 million in funding, with investors including China’s LianLuo (Beijing Digital Grid), Intel and Accel. It’s currently valued at $1.5 billion, but has never been public about its revenues or other metrics. This is Razer’s second acquisition, after it purchased gaming startup Ouya’s software, technology and development teams in an all-cash deal in 2015.

You may not know exactly what THX does today, but chances are you would recognize the company’s famous “Deep Note” warp clip at the start of a movie, which indicates when a film has been through the THX treatment. This is the 2015 remastered version: