Samsonite $85 Million Swallow Gregory Merger

Yesterday, Samsonite announced that it would buy Gregory, the leading supplier of high-end professional Backpackers, mountaineering and cross-country running products and accessories for us $85 million, which is the third acquisition of Samsonite this year and is expected to be completed in late July this year.

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< p > < strong > M & a pformation < /strong > < /p >

Ma Ruiguo, vice president of Samsonite Greater China, told reporters that after the completion of the acquisition, Gregory will expand its own sales channels through professional outdoor products counters and exclusive stores in the Chinese market, P.

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< p > in fact, Samsonite's M & A has become more frequent this year.

In April, it announced the purchase of French luggage and brand Lipault with 20 million euros in cash. At the beginning of this month, it announced the acquisition of SpeckProducts, the mobile phone protection shell brand located in the US Silicon Valley.

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Tim Parker, chief executive of Samsonite P, has said that 1 billion dollars will be spent in the next two or three years to buy and expand products of the group.

5 years ago, Samsonite brand accounted for more than 75% of the company's sales, and now the figure has dropped to 69.4%.

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"P" was created in the 1977 Gregory. In the field of high-end professional backpacker, mountaineering and cross-country running products and accessories, its products are famous for their innovative design, ergonomics, high quality and durability. In addition, a series of Gregory leisure packages inspired by its design style and its birthplace in California are popular in Japan and other parts of Asia.

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< p > as of December 31, 2013, the net sales of Gregory amounted to US $34 million 900 thousand, up 14.3% from US $30 million 600 thousand last year.

In 2013, North America and Japan accounted for about 35.5% and 36.3% of Gregory sales respectively, while professional backpackers and accessories accounted for about 72.3% of sales, while leisure knapsack and accessories accounted for 27.7%.

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< p > > a href= "http://www.91se91.com/news/index_c.asp" > Samsonite < /a > indicates that through the adoption of a strong brand and product mix, it can expand its coverage in the outdoor and leisure market, and also provide the company with the opportunity to play its advantage in marketing and distribution capabilities, so as to expand the Gregory brand in the United States and the international market.

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Zhou Ting, President of the Institute of wealth and quality, told reporters before that, "Samsonite is influenced by the development trend of high-end luxury brands under the trend of popularization and fashion. On the other hand, it is affected by consumption diversification and personalized consumption trend. A single strong brand can not withstand risks and support long-term stable growth, so Samsonite makes the pformation of brand diversification and product diversification". P

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< p > strong > high-density merger and acquisition will be "indigestion"? < /strong > /p >

< p > however, the market is worried that high-density "a href=" http://www.91se91.com/news/index_c.asp "M & a" /a "may make Samsonite" indigestion ".

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Wang Danqing, a partner at P, told reporters that through a series of mergers and acquisitions, Samsonite hopes to have a layout in different sub regional markets, different professional product lines and high and low end positioning.

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< p > "multi brand operation is also a common mode of consumer brand industry. Although different brands operate independently of different business modules, there is a certain synergy effect. In recent years, Samsonite's business status and profitability are also good, so there is also a financial basis for such high-density mergers and acquisitions. Besides, Samsonite also has some experience through the operation of small scale multi brands."

Wang Danqing said.

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"P > DDT consulting partner Zhang Tianbing also told reporters:" as long as the acquisition of the brand itself, profits and cash flow is not a big problem, Samsonite may not need too much involvement in management, but can use channel marketing and other resources to expand the brand.

For the luggage brand, the scale of each subdivision is limited, and the scale effect of multi brands can be better achieved through such mergers and acquisitions. "

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< p > in addition to the three acquisition this year, in July 2012, Samsonite also purchased nearly all HighSierra assets for 110 million US dollars to enhance its share in the outdoor leisure bag market.

A month later, it bought a US company Hartmann founded in 1877, producing luxury suitcases and business bags at the price of 35 million US dollars. The latter's net sales at the end of 2011 were 23 million 100 thousand US dollars, up 26% over the same period last year.

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< p > Samsonite responsible person has revealed in the media interview that, in view of the highly fragmented market of the whole bag market, the company's future acquisitions will focus on some small and medium-sized brands, with sales of 50 million ~1.5 billion dollars.

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< p > < strong > > < < a > href= > > outdoor market > /a > /strong > /p >

< p > different from sports brand closure, in recent years, outdoor products industry has maintained a relatively high speed of development.

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< p > according to the 2013 annual survey report of China outdoor products market provided by COCA, the total retail sales of domestic outdoor markets increased by 24.3% in 2013 compared with the same period last year, and the composite growth rate has reached 29.5% in the past five years.

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The development of industries like P has also been found in the earnings of listed outdoor companies.

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< p > for three consecutive years, the Pathfinder's income and net profit have maintained a relatively high growth rate.

In 2011, Pathfinder operating income and net profit increased by 73.64% and 98.81% respectively compared with the same period last year. In 2012, its operating income and net profit increased by 46.68% and 57.44% respectively compared with the same period last year. In 2013, its operating income and net profit increased 30.74% and 47.48% respectively compared with the same period last year.

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< p > industry insiders say that the gross profit rate of outdoor products can usually reach about 50%. However, with the increasing number of brands coming into the market, the competition of outdoor products industry will intensify further in the next few years.

In 2013, the gross profit margin of outdoor clothing for the Pathfinder reached 49.38%, the gross margin of outdoor footwear was 55.03%, and the gross profit margin of outdoor equipment reached 42.65%.

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< p > Samsonite has also achieved good results in recent years. As of December 31, 2013, Samsonite's net profit increased by 18.6% from 2012 US dollars in fiscal year 148 million 400 thousand to US $176 million 100 thousand.

Net sales for the first time exceeded 2 billion US dollars, reaching US $2 billion 37 million 800 thousand, an increase of 15% over the previous year, excluding the effect of exchange rate, an increase of 16.1%.

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Flagship brand Samsonite sales increased by 9.7% over the previous year, accounting for 69.4% of the business, while the AmericanTourister, which was positioned as a cost-effective brand, accounted for 21.1% of the company's global business, and has become the main driving force for the company's growth in Asia. Last year, sales increased by 26.6% in fixed currency terms. P

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In the first quarter of this year, Samsonite's net sales rose 9.6% to 511 million US dollars over the first quarter of last year. P

Among them, the Asian market, which accounted for 40% of net sales, performed best, especially in India, Japan and South Korea, with an increase of 33.8%, 28.1% and 24.6% respectively.

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