DivX (DIVX) Shares Soar On the Sonic (SNIC) Merger Announcement

DivX Inc. (DIVX) soared as much as 30 percent to $8.90 on Wednesday, its biggest intraday increase since October 2008, after Novato-based Sonic Solutions Inc. (SNIC) said it agreed to buy for about $323 million in cash the maker of Web video compression technology. Based on Tuesday’s closing prices, the DIVX deal is worth $9.83 per share, a premium of 40 percent.

DivX investors will receive 0.514 shares of Sonic common stock and $3.75 per share of DivX stock. According to Sonic CEO Dave Habiger, “The combination of Sonic and DivX promises to be the foremost provider of platforms, tools, and technologies for the efficient delivery of premium video entertainment to virtually any type of consumer electronics device.”

The DivX web properties enjoy more than 12 million unique visits each month.

Under terms of the deal, DivX CEO Kevin Hell, CFO Dan Halvorson, and General Counsel David Richter will leave the company once the acquisition is completed in September 2010.

DIVX gained $1.76, or 25.32 percent, to $8.70 at 1:05 p.m. in Nasdaq composite trading. SNIC  declined $1.23, or 10.40 percent, to $10.60.

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