Inside takeover?
What's happening behind the scenes at $SONO?
Our research team identified interesting activity behind the scenes at Sonos.
First - who is Sonos?
Sonos is a global leader in smart home audio.
It develops and manufactures wireless speakers and sound systems.
Its business model is based on an 'ecosystem' – a customer who buys one speaker tends to purchase additional products to fill their home.
What's happening behind the scenes?
In recent weeks, we identified that the hedge fund Coliseum Capital made several purchases of Sonos stock in the open market.
Before we dive into the purchase data and our research, it's important to highlight a few details:
The hedge fund Coliseum Capital is already defined as an interested party in the company – it holds over 10% of Sonos stock, and Christopher Shackelton, co-founder of Coliseum, serves as a board member at Sonos.
From here, let's move to the purchase data:
In the last month alone, the fund purchased Sonos stock in several tranches:
494,000 shares at $15.50
211,000 shares at $16.29
100,000 shares at $16.11
257,000 shares at $15.74
290,000 shares at $15.59
360,000 shares at $14.90
133,000 shares at $14.83
118,000 shares at $15.25
Meaning: millions of additional shares were accumulated within weeks.
The total purchases in the last month alone amount to over $43,000,000.
And the strange thing?
These are not the only purchases.
Last year – in April, June, July, August – the fund purchased shares totaling approximately $32,000,000.
What caught our attention is the price at which the fund made the stock purchases.
Whereas last year the fund purchased at prices ranging from $8 to $11.
This year, purchases were at much higher prices – between $13 and $16.5.
The fund's total purchases in the last year alone amount to $75,000,000.
To truly understand what's happening here, our research team thoroughly investigated Coliseum Capital.
We weren't surprised to discover – it's an activist fund.
Meaning – they don't just buy shares.
Rather, they are actively involved in the company's board – in setting the company's strategy, cutting costs, and creating value for themselves – and for shareholders.
But what's happening now with Sonos?
In fact, Sonos has become one of the fund's largest holdings, now accounting for approximately 23% of the fund's assets!
Coliseum now holds over 17,000,000 Sonos shares – while the total tradable shares held by the public is only 118,000,000.
If we consider that there are additional funds or insiders holding millions of shares, Coliseum effectively holds a significant portion of the Sonos stock market.
The big question
What is Coliseum fund's plan?
Our research team, which scoured the web, found several interesting findings.
Sonos' name is mentioned in several events – as a candidate for acquisition:
Note this -
1. A Citron Research report (January 2020) claiming it was the 'perfect time' for Apple to acquire the company.
2. Analyst Samik Chatterjee from J.P. Morgan (March 2019) mentions (in the middle of the article) Sonos as a strategic target for Apple.
3. A Bloomberg report (January 2025) analyzing potential acquirers of Sonos (Amazon or Spotify).
And this is precisely where one wonders – is the Coliseum hedge fund, which holds a very substantial stake in Sonos, trying to push the company towards an 'exit'?
When we examined insider activity at Sonos in recent years, we discovered that Coliseum is not the only insider buyer:
- The CEO bought shares (at $11-$16) for approximately $2,000,000.
- The CFO bought shares (at $11) for approximately $250,000.
- Two directors bought shares (at approximately $11) for a total of approximately $500,000.
We are monitoring.