Samsonite International S.A. (“Samsonite” or the “Company”) today announced that it has agreed to acquire Gregory Mountain Products (“Gregory”), an iconic technical outdoor backpack brand, from Black Diamond, Inc., for US$85.0 million in cash, to be financed by Samsonite’s internal resources as well as its revolving credit facility. The acquisition provides a perfect complement to Samsonite’s High Sierra product offering and significantly broadens the Company’s presence in the outdoor category. The transaction is subject to certain closing conditions and expected to close in late July 2014. The Company also announced today that it has increased its existing Revolving Credit Facility from US$300.0 million to US$500.0 million, giving it greater financial flexibility as it continues to evaluate acquisition opportunities globally.
“Gregory is another exciting new addition for us as we continue to strategically diversify our brand and product portfolio,” said Tim Parker, Chairman and Chief Executive Officer of Samsonite. “Like Samsonite, Gregory is a leader and pioneer in its industry, responsible for many innovations in backpack design. It is well-respected by active outdoor and adventure enthusiasts as a leading brand in the premium technical backpack segment, and has won numerous awards such as National Geographic Magazine’s Gear of the Year Award in 2012 and the coveted ISPO Award in 2013. We believe there is plenty of room to further expand the brand in the U.S. market by leveraging our marketing and distribution capabilities. Moreover, our geographic reach will also allow us to significantly grow theGregory brand internationally.”
Tom Korbas, President – Americas for Samsonite offered, “There’s a growing trend towards living healthier, more active lives and the number of consumers participating in outdoor activities has been increasing steadily as a result. The transaction further positions us to address this trend by offering two well-known and respected brands – Gregory in the premium segment and High Sierra in the mid-market – offering us significant growth opportunities in the outdoor market.”
Peter Metcalf, President and Chief Executive Officer of Black Diamond said, “I would like to take this opportunity to thank all of our employees and partners for their hard work and support in helping to build Gregory into a global leader in the outdoor segment. We are proud of the strong reputation that Gregory has established and maintained over the nearly forty years of its history, and are excited by its bright future under Samsonite’s ownership.”
Founded in 1977, U.S.-based Gregory is a leading provider of premium technical backpacking, mountaineering, and trail running products and accessories. A pioneer in its field, Gregory is well-known for setting performance standards in terms of the innovative design, ergonomics, high quality and durability of its products. Among its many achievements, Gregory led the industry in offering backpacks with a range of different frame sizes, waist belts and shoulder harnesses designed to provide an ergonomic and comfortable fit for both male and female consumers. It also pioneered a waist belt system that automatically adjusts to the angle of the user’s hips in order to improve comfort while carrying weight. As part of its offering, Gregory markets a collection of lifestyle bags inspired by its design heritage and California roots.
For the year ended December 31, 2013, Gregory’s revenue increased approximately 14.3% to US$34.9 million from US$30.6 million in 2012. Technical backpacks and accessories accounted for 72.3% of Gregory’s revenue in 2013, while lifestyle backpacks and accessories accounted for the remaining 27.7%.
This is Samsonite’s third strategic acquisition in 2014. The Company announced at the end of May that it had acquired Speck Products, a leading U.S. designer and distributor of slim protective cases for personal electronic devices, and in April that it had acquired Lipault, a youthful French luggage company known for its functional and fashionable products.
As Samsonite continues to evaluate further potential acquisition opportunities that offer both a compelling strategic and financial rationale, the Company has increased its existing Revolving Credit Facility from US$300.0 million to US$500.0 million, and extended its term from three years to five years, effective from June 18, 2014. This larger facility gives Samsonite additional financial flexibility and capacity to pursue further acquisition opportunities as and when they become available.
Logo courtesy Gregory Mountain Products