Fiskars Corp. said Monday it agreed to buy the WWRD group of companies and its portfolio of luxury home and lifestyle brands, which include Waterford, Wedgwood, Royal Doulton, Royal Albert and Rogaška. The seller is KPS Capital Partners. The $437 million purchase price is subject to a post completion adjustment based upon the level of net working capital and cash and debt in the acquired business on a closing date.
HELSINKI, May 11, 2015 /PRNewswire/ —
Fiskars Corporation (Fiskars) ( NASDAQ OMX Helsink : FIS1V ), a leading global supplier of consumer products for the home, garden and outdoors, has agreed to acquire the WWRD group of companies (WWRD) and its portfolio of iconic luxury home and lifestyle brands, which include Waterford, Wedgwood, Royal Doulton, Royal Albert and Rogaška. Fiskars continues executing its growth strategy and becomes a leading global branded consumer goods company in the luxury and premium home and lifestyle products market, with a clear focus on tabletop, giftware and interior décor. For Fiskars Living business, the WWRD acquisition will create a strong presence in the U.S., and will further enhance Fiskars’ market position in Europe andAsia-Pacific.
Fiskars has on May 10, 2015 agreed to buy 100% of the shares in the holding company of the WWRD group, including its brands and business operations from the U.S.-based private equity firm KPS Capital Partners. Fiskars will also acquire certain intercompany receivables. The purchase price payable is USD 437 million (EUR 406 million) on a cash and debt free basis, subject to a post completion adjustment based upon the level of net working capital and cash and debt in the acquired business on a closing date. Fiskars will finance the acquisition by monetizing its holdings in short term interest rate funds. The transaction is subject to the completion of the antitrust filing under the U.S. Hart-Scott-Rodino Antitrust Improvements Act (HSR Act), and it is expected to close in the beginning of July 2015.
According to unaudited special purpose carve-out financial information, the net sales of WWRD equalled USD 432 million (EUR 402 million) and preliminary EBIT USD 33 million (EUR 31 million) at company’s constant currency rates in fiscal year ending on April 4, 2015. The estimated geographic distribution of the aforementioned net sales is Americas 44%, Asia-Pacific 35%, and Europe 21%.
Fiskars’ outlook for 2015 published in Q1 2015 interim report on April 30, 2015 does not take into account the impact of the now disclosed acquisition on the company’s net sales or operating profit for 2015. Potential implications on Fiskars’ outlook for 2015 will be announced later when a reasoned estimate can be made.
Upon the closing of the transaction, Fiskars and WWRD will start building a successful future together as part of a strong family of highly renowned brands. The management of WWRD will report to Mr. Kari Kauniskangas, President and CEO of Fiskars Corporation.
“We are delighted to be bringing together WWRD’s portfolio of iconic luxury home and lifestyle brands with Fiskars’ highly regarded Living brands of Iittala, Royal Copenhagen, Arabia and Rörstrand, which are renowned for their Scandinavian design and heritage. After the acquisitions of Iittala Group Ltd. in 2007, Royal Copenhagen A/S in 2013 and now WWRD, Fiskars Group is set to become a leading global branded consumer goods company in the area of luxury and premium home and lifestyle products focusing on table top, giftware and interior décor,” says Kari Kauniskangas, President and CEO of Fiskars Corporation.
“Through the acquisition we will create a strong presence for the Fiskars Living business in the U.S., and further enhance Fiskars’ market position in Europe and Asia-Pacific. Fiskars will now have a balanced portfolio of businesses. Our Functional products and Living products business units will become approximately equal in size and all business units, including Outdoor, will continue as important parts of our company and will be developed according to our strategy,” continues Mr. Kauniskangas.
The brand portfolios and product offerings of Fiskars Living business and WWRD complement each other exceptionally well. Fiskars will continue to develop all WWRD and Fiskars Living brands, as the success of each brand stems from preserving their intrinsic values. As a company with centuries of history, the heritage and longevity of WWRD’s brands resonates strongly with Fiskars. The unique offering of each brand is based on a combination of their heritage and history. Fiskars will focus on strengthening these unique brands based on Fiskars’ consumer insight and deep understanding of consumer goods industry drivers and on leveraging common success models across them.
“We look forward very much to building a joint future with Fiskars. There is an excellent fit with the brand portfolios of both companies, and we will be able to build a joint success that will stem from the deep roots and core values of both the WWRD and Fiskars’ Living brands. We are delighted to be getting an owner that has strong industry experience and an impressive 365 years of heritage in Scandinavian design. I am confident that these strengths, together with our continued focus on contemporary relevance, will ensure that the WWRD brands will retain and indeed grow their iconic status around the world and capture the ongoing growth in luxury demand,” says Mr. Pierre de Villeméjane CEO of WWRD.
WWRD brands are synonymous with exquisite design, exacting quality and skilled craftsmanship
WWRD manufactures, distributes and sells globally renowned brands with centuries of heritage. The portfolio includes Wedgwood (established in 1759), Waterford (1783), Royal Doulton (1815), Royal Albert (1904), and Rogaška (1665). WWRD has a global footprint and has manufacturing sites in England, Ireland, Slovenia and Indonesia. The retail store structure consists of 226 own stores, of which 76 are owned by WWRD and the remaining 150 are concession stores. WWRD products are also sold in luxury and premium department stores and by specialty retailers in over 100 countries and 10,000 locations. WWRD employs 3,800 employees across 14 countries and, after the acquisition, Fiskars Group will employ a total of 8,600 employees.
WWRD has high-profile licensing partnerships and collaborations with leading designers and innovators in the home and lifestyle market, including: Vera Wang, Jasper Conran, John Rocha, Monique Lhuillier, Gordon Ramsay, Donna Hay, Miranda Kerr, Jo Sampson, Barber and Osgerby.
Preliminary unaudited combined financial information
Basis for preparation
The unaudited combined financial information presented below is based on Fiskars Group’s audited financial statements for the financial year 2014 and WWRD Holding Limited’s unaudited special purpose carve-out financial information for the 12 months period ended April 4, 2015.
The combined financial information is for illustrative purposes only. The combined financial information gives an indication of the combined company’s sales and earnings assuming the activities were included in the same company from the beginning of the last financial year. The combined financial information is based on a hypothetical situation and should not be viewed as pro forma financial information as purchase price allocation, transaction costs, differences in accounting principles, financing costs and effects of the financial year alignments have not been taken into account. The difference between preliminary consideration to be transferred and WWRD’s carve-out net assets has been allocated to non-current assets on the illustrative combined balance sheet.
For the purpose of this illustrative combined financial information, the preliminary consideration to be transferred has been assumed to be financed by monetizing Fiskars’ holdings in short term interest rate funds. The effects of the planned financing have been taken into account in the illustrative balance sheet information. However, no adjustment for any additional financing costs has been included in the illustrative income statement information.
WWRD’s income statement and balance sheet information and all before mentioned financial figures have been converted into EUR using the EUR/USD exchange rate as at 31 March 2015 (1.0759).
For the purposes of financial reporting, the actual consolidated financial statements of Fiskars will, however, be calculated based on the consideration transferred and the fair values of WWRD’s identifiable assets and liabilities at the closing date and as a result, the consolidated income statement will reflect the amortization and depreciation charges of the acquired assets recognized at fair value. Balance sheet items could therefore differ significantly from the combined financial information presented below and, as a result, have a significant impact on other items included in the income statement of the combined company. As such, the preliminary combined financial information presented below is not necessarily indicative of future results of operations or financial position of Fiskars.
Further the financial information for WWRD has been prepared on a “carve-out” basis and it does not necessarily reflect what its combined results of operations and financial position of WWRD would have been, had WWRD operated as an independent group and had it presented stand-alone financial information under IFRS during the periods presented. Moreover, the carve-out financial information may not be indicative of WWRD’s future performance of the operative activities aggregated within Fiskars.
Unaudited illustrative combined income statement information (2014)
EUR million Combined Fiskars* WWRD company Net sales 1 169.1 767.5** 401.6 Operating profit (EBIT) excluding non-recurring items 90.5 59.6** 30.9 Profit before taxes 85.9 82.8 3.1 Profit for the period 63.7 62.6** 1.1 *Fiskars Profit before taxes and Profit for the period exclude non-recurring profit from the sale and revaluation of Wärtsilä shares and net change in fair value of investment portfolio: EUR 703.9 million excluded from Profit before taxes and EUR 710.7 million excluded from Profit for the period. ** Incl. the recently acquired watering business as if acquired on January 1, 2014, Fiskars’ pro forma net sales would have been EUR 842.3 million, Operating profit (EBIT) excl. non-recurring items EUR 58.3 million and Profit for the period EUR 61.8 million. Unaudited illustrative combined balance sheet information (Fiskars: December 31, 2014, WWRD: April 4, 2015) EUR million Combined Fiskars WWRD company* Non-current assets 775.3 478.8 175.1 Current assets (excluding cash) 955.5 1 077.1 178.3 Cash and cash equivalents 40.5 33.6 6.9 Total assets 1 771.3 1 589.5 360.3 Equity 1 153.2 1 153.2 178.6 Non-current liabilities 193.7 90.9 102.8 Current liabilities 424.4 345.4 79 Total equity and liabilities 1 771.3 1 589.5 360.3
*For illustrative purposes, Combined company includes allocation of estimated purchase price payable to Current assets (excluding cash), allocation of the difference between preliminary consideration to be transferred and WWRD’s carve-out net assets to Non-current assets and elimination of WWRD’s equity.
President and CEO
Analyst and press conference:
An analyst and press conference will be held on May 11, 2015 at 12:00 am in Hotel Scandic Simonkenttä (Simonkatu 9, 00100 Helsinki, Finland). Presentation materials will be available after the event at http://www.fiskarsgroup.com.
A media kit with additional information on Fiskars Group’s and WWRD’s brands as well as press images and logos is available athttp://www.fiskarsgroup.com/wwrd
Fiskars – celebrating centuries of pride, passion and design. Every day.
Established in 1649 as an ironworks in a small Finnish village, Fiskars has grown to be a leading global supplier of consumer products for the home, garden and outdoors. Available in more than 60 countries, Fiskars products solve everyday problems, making daily home, garden and outdoor projects easier and more enjoyable through superior performance and design. Fiskars is listed on NASDAQ OMX Helsinki (FIS1V), and the company’s net sales were 768 million euro in 2014. The company employs 4,800 people in 20 countries. Before the acquisition of WWRD, the Group’s key international brands have been Fiskars, Iittala and Gerber.http://www.fiskarsgroup.com
WWRD is a leading provider of luxury home and lifestyle products worldwide. WWRD manufactures, distributes and sells well-recognised brands including Waterford, Wedgwood, Royal Doulton, Royal Albert and Rogaška. WWRD maintains unique licensing arrangements with some of the most high-profile designers and innovators in the home and lifestyle market, including Vera Wang,Jasper Conran, Monique Lhuillier, John Rocha, Gordon Ramsay, Donna Hay, Jo Sampson and Miranda Kerr. WWRD products are distributed through premium department stores and independent retailers and wholesalers around the world, including the United States, the United Kingdom, Japan, China, Taiwan, Korea, Canada, Australia and Ireland. The company employs 3,800 people worldwide. WWRD is the proud holder of the Royal Warrants by Appointment for tableware and giftware to Her Majesty The Queen for Wedgwood, and to His Royal Highness The Prince of Wales and Her Majesty The Queen for Royal Doulton. http://www.wwrd.com
KPS Capital Partners LP
KPS is the manager of the KPS Special Situations Funds, a family of investment funds with more than $5.7 billion of assets under management. KPS seeks to realize significant capital appreciation by making controlling equity investments in companies across a diverse range of manufacturing industries experiencing a period of transition or challenged by the need to effect immediate and significant change. The KPS investment strategy is based primarily upon partnering with world-class management teams to effect material and sustainable improvements in the operations of its businesses. Thereafter, KPS focuses on growing its businesses, both organically and through strategic acquisitions. KPS portfolio companies have aggregate annual revenues of approximately $6.4 billion, operate 106 manufacturing facilities in 26 countries, and employ more than 45,000 associates, directly and through joint ventures worldwide. The KPS investment strategy and portfolio companies are described in detail at http://www.kpsfund.com