Consumer Products M&A & Corporate Finance Deals – winter spring 2018-2020
13 Feb, 2020
Our consumer product specialists take a look at the key M&A and corporate investment deals over the recent period across the wide breadth of sub sectors in the consumer industries.
Second Half 2018
Mangar International, a Welsh company that provides a range of lifting assistance equipment and mobility aids, was acquired by French manufacturer of medical preventative care products Winncare. Particularly appealing to Winncare was Mangar’s global reach, including its international distribution network, and its product lines in adjacent healthcare markets, including the emergency services.
US-headquartered Revolution Dancewear, was acquired by Audax Private Equity, and it went on to buy International Dance Supplies, a UK-based dance apparel and supplies distributor. We would expect Revolution to continue on the acquisition trail – Audax has made it an explicit remit to invest in the dancewear company to expand through buy-and-build.
Prism UK Medical is expanding its group of companies that manufacture lifting, handling and bathing equipment for the disabled, by acquisition. Last year it bought Durham-based Care-ability (£1.8m net assets), a manufacturer of moving and handling products, Stirling-based Assured Healthcare (£500k net assets), a supplier of patient lifting equipment, and Rotherham-based Harvest (£9m sales, £400k EBITDA), which manufactures & distributes healthcare equipment. The deals are part of strategy to increase the group’s reach into care homes, hospitals and the community.
Private equity firm Graphite Capital acquired Nottingham Rehab Supplies, in order to support NRS’s buy-and-build strategy. NRS distributes technical aids for disabled adults and children, including bedroom & seating aids, eating & drinking aids, mobility and household products, and counts the NHS, local authorities and other community-based organisations throughout the UK and Ireland.
Chicago-based Life Fitness, a supplier of commercial fitness equipment was sold by US-listed Brunswick Corp to KPS Capital Partners, an investment firm in a $490m deal. We expect to see bolt-on acquisitions as Life Fitness’s new owner expands its geographic reach and develops its product range.
Last summer Irish Dog Foods, which had already taken a 50% stake in Newark-based Bennington Foods (£9m sales), took full ownership of the business. The deal gives County Kildare-based Irish Dog Foods a UK manufacturing base and also access to Bennington’s established relationships with other pet food manufacturers and retail customers.
Vision Support Services a soft furnishings textile wholesaler behind a number of heritage brands was acquired by WestPoint Home, a US-based manufacturer and distributor of home and fashion textiles.
Listed luxury shopping platform Farfetch acquired New Guards Group, a Milan-based designer, manufacturer and distributor of clothes and accessories in a £550m deal. It is part of Farfetch’s strategy to extend its capabilities beyond technology solutions and global distribution into design, production and brand development. FarFetch went on to buy US clothing brand Opening Ceremony from Berkshire Hathaway in January 2020.
Naughtone, a North Yorkshire-based office furniture maker was acquired by Herman Miller for £36m. The US manufacturer had previously acquired a majority stake in the business in previous transactions. Herman Miller also paid £64m last year to increase its stake in Danish designer and manufacturer of household furniture HAY from 33% to 67%, having acquired an initial interest in 2018. HAY is expected to bring an innovative product direction to the Herman Miller Group and will expand its retail and contract furnishing footprint.
The management team of luxury fitted furniture and cabinet maker Clive Christian Furniture acquired the business from its shareholders, including majority owner Souter Investments, the private family investment office of Stagecoach co-founder Sir Brian Souter.
Chanel acquired stakes in a pair of Italian luxury goods companies – Renato Corti and Mabi International, as well as Grandis SAS – a French manufacturer of clothes, for a total consideration of £138m. The deal will enable Chanel to expand its operations and product range, and strengthen its position in Italy and France. In 2018 Chanel acquired British high-end swimwear designer Orlebar Brown.
Ethos Partners, a private equity firm that typically invests £3-10m of equity capital has made a pair of recent investments into consumer brands. It announced the £22m buyout of Hertfordshire-based Motocaddy, Europe’s leading provider of powered golf trolleys, with the funds raised backing the management team to continue delivering product innovation and UK and international expansion. In January 2020, Ethos acquired Pet Mate (£2m EBTIDA), the Surrey-based designer, manufacturer and distributor of innovative pet products.
Le Col, a fast-growing British cycling brand, secured £2.35m funding from Puma investments, with the option to increase its investment to £3.5m. In 2017 Le Col secured £1m from crowd investors, and it has reported that sales were set to treble in 2019, with ecommerce in particular seeing a sevenfold increase.
Mayfly Outdoors, the US-based owner of the Ross Reels and Abel Fly reel brands acquired British fly line manufacturer Airflo Fishing for an undisclosed sum. The deal will enable Mayfly to have a stronger presence in key European markets, and will give Airflo access to a leading fly fishing market – the Rocky Mountain region. Airflo Fishing was previously owned by BVG Group and had sales of c£10m.
Cairngorm Capital Partners acquired Grant & Stone, a High Wycombe-headquartered provider of products and services for the building, plumbing and electrical trades, along with its ecommerce subsidiary Depot UK. Cairngorm own a number of other building supply brands, including Customade Group, which makes aluminium PVCu windows, doors and conservatories. Cairngorm merged Customade with Polyframe in 2017, and has grown the group to a £112m turnover business.
French sports manufacturer and retailer Decathlon acquired one of the world’s oldest hockey brands, Dutch firm Dita, from Nederlands Merkgoed, a private equity-backed group that develops and distributes a range of sports brands.
Sportmaster, a retailer of sports goods with 89 Sportmaster and Rezet Sneaker stores that is also headquartered in Denmark, was sold by its private equity owner Nordic Capital to Singaporean retail chain Sportmaster Group.
South Africa-headquartered Bidvest, a B2B distribution company, announced it had acquired cleaning services business PHS Group for £495m. The deal will help Bidvest to expand its operation in Europe.
Christy Sports, a Colorado-based winter sports retailer, was bought by US private equity firm TZP Group. The sports brand firm was previously owned by Norwest Equity Partners for four years, during which time it acquired and grew organically to double both revenue (to £163m) and EBTIDA.
The end of 2019 also saw US-based Geiger acquire its London based distributor Shout Promotional Merchandise as part of their continued expansion strategy into the UK and across Europe, and earlier in the year it acquired Berkshire-based Lancewich.
Danish sports footwear and apparel brand Hummel acquired domestic counterparts Newline and HALO. Hummel is a vertically integrated designer, producer and marketer of high quality clothes and sports equipment for both adults and children, and is part of Thornico, an acquisitive diverse group of over 150 companies globally.
The sports division of Tennessee-based MacNeill Pride Group acquired Outdoor Recreation Company of America (ORCA), a Nashville-based manufacturer of outdoor accessories, such as cool boxes and drinkware. MacNeill has announced a diversification strategy, and with the backing of its private equity owner Centre Partners is expanding its presence in the lifestyle product market and expanding its retail channels worldwide.
US-based distributor of chemicals, foodservice disposables, janitorial supplies and equipment Imperial Dade, has made a string of recent acquisitions in the cleaning and distribution space. In January 2020 it bought two companies: Californian firm American Paper & Plastics to expand its geographical reach and Texas-based Wagner Supply. Imperial Dade has been backed by Bain Capital Private Equity since May, with an explicit strategy of using funds raised to accelerate its acquisition strategy.
Another US chemical supplier that has been active in M&A is Ecolab. In January 2020 it bought Belgian agricultural sector cleaning specialist CID Lines for £382m, a deal on the heels of a series of acquisitions in the US, Australia and Europe in 2019 as it seeks to expand its geographic footprint and enhance economies of scale.