Jarden, maker of coleman camping equipment and Mr. Coffee, bids $1.2 billion for K2
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Jarden, maker of coleman camping equipment and Mr. Coffee, bids $1.2 billion for K2
Looks like it's not a bid, but a definitive agreement. I've seen two numbers -- $1.2b (e.g., Intl Herald Tribune) and $765m (e.g., Forbes), based on the same per-share calculation. So who knows.
1.2b includes assumption of debt. 765mm is the per share not including debt.
Yay! (I think?)
So what does this mean to us - the consumer?
Free cooler with your next purchase of K2 skis?
coleman fuel rocket powered morrow snowboards
It appears that Jarden has purchased K2 Corp. which makes sense. K2 Corp. is a seperate entity than K2 Skis. It is the parent company. There probably won't be any visible changes at the consumer level or even the production level for K2 skis. A free cooler would be nice though.;)
Coleman makes some bomber camping gear. If you like heavy duty stuff and are not concerned about weight, they have some of the best stuff for the money.
Just don't give away those grills... they suck.
Mr. Coffee, huh? Maybe K2 can get Joe DiMaggio as a pitchman. Oh, that's right. He's dead.
My understanding of K2 was that they're kind of a strategic experiment with doing a roll-up in the sporting goods world. Trying to make the company more efficient through acquisitions. I wonder if the acquisition means that was a successful strategy or if it just means they gave up?
If they're gonna use dead guys, they should bring back Spider Sabich.Quote:
Originally Posted by The AD
They're already using Doug Coombs.Quote:
Originally Posted by The AD
For car camping, maybe. Just because their two burner stove is ubiquitous doesn't mean they make great gear.Quote:
Originally Posted by 72Twenty
Coleman sleeping bags, tents, etc are the suck. Overall, I would say their gear is pretty damn mediocre.
Why would Gary Coleman buy K2?
http://usera.imagecave.com/anevileye...leman-copy.jpg
Watchoo talkin' about?Quote:
Originally Posted by cl1953
More importantly, I just heard of a drink combination at the bar yesterday called a Gary Coleman: a small glass of downtown brown, and a shot of Jaeger.....it was surprisingly good...although I couldn't figure why Gary Coleman would like them.....
Some relevant articles.....
Quote:
arden Agrees to Buy
K2 for $765 Million
By JOSEE ROSE
April 25, 2007 7:17 a.m.
Jarden Corp., adding to its hodgepodge of consumer-products brands, agreed to buy sports-equipment maker K2 Inc. for $765 million, excluding debt. The total value of the deal is about $1.2 billion in cash and stock.
Jarden, Rye, N.Y., will offer $10.85 in cash and 0.1086 of a share for each K2 share, an offer worth roughly $15.50 a share at Tuesday's closing prices. K2 shares were trading at $12.58, down 4 cents, in 4 p.m. New York Stock Exchange trading Tuesday. Jarden shares were down 50 cents to $43.10. The deal is expected to close early in the third quarter.
The purchase gives Jarden a portfolio of well-known sporting goods brands, including K2 ski gear, Penn fishing reels, Marmot apparel and Rawlings baseball equipment.
Jarden has had success in recent years acquiring and then reviving well-known but tired consumer-products brands such as Coleman camping gear, Sunbeam kitchen appliances, Ball canning jars and Crock-Pot cookers.
The acquisition of K2 is Jarden's biggest purchase yet, and allows Jarden to expand its reach into specialty retailers and increase sales opportunities in the U.S. and abroad.
Earlier Wednesday, Jarden said first-quarter net income dropped to $1.4 million, or 2 cents a share, from $5.7 million, or 9 cents a share, a year earlier, on a charge related to debt extinguishment. On an adjusted basis, earnings rose to 30 cents a share. Sales rose 4% to $821 million.
K2 also reported first-quarter results Wednesday morning; net income rose 31% to $4.8 million, or 9 cents a share, from $3.6 million, or 8 cents a share, a year ago. On an adjusted basis, earnings rose to 14 cents from 10 cents. Sales increased 7% to $373 million.
Some background on Jarden, and what they're about.....
12345667Quote:
How to Turn Trash Into Treasure
Smaller Firms Hone Ways
To Revive 'Orphan' Brands
Cast Off by Large Companies
By ELLEN BYRON
April 13, 2007; Page B1
When Martin Franklin, chief executive of Jarden Corp., acquired Coleman camping goods two years ago, he knew he was taking on a tired business.
Coleman, though still selling its familiar coolers and lanterns at discounters such as Wal-Mart Stores Inc. and Target Corp., had few new products in development after its previous owner had filed for bankruptcy protection. What's more, it was caught in a waning interest in outdoor recreation as young people increasingly turned to digital adventures rather than the wild.
Coleman was also trapped in a classic squeeze play. As a mass-market brand, it had to fend off competition from low-price, store-brand products. On the high end, nimble competitors were selling high-tech alternatives. And despite many outdoor enthusiasts harboring nostalgia for a brand they'd known since childhood, they had doubts about Coleman's quality.
[Prestige Brands Holdings has acquired and tweaked well-known brands like these.]
Prestige Brands Holdings has acquired and tweaked well-known brands like these.
Mr. Franklin saw opportunity nonetheless. "We look for brands that are market leaders but haven't been innovative," he says of his acquisition choices, which include other niche products with famous names such as Ball canning jars, Bicycle playing cards and Crock-Pot cookers. "We had to make Coleman the innovator again."
Mr. Franklin is in the vanguard of executives who are refining ways to turn one company's trash into another's treasure. Under pressure to deliver growth, a number of consumer-products titans, including Procter & Gamble Co., Unilever and Colgate-Palmolive Inc., have been selling well-known but underperforming brands to better focus on those with more potential. Smaller firms trying to play Dr. Frankenstein have bought such familiar castoff brands as Sure and Right Guard deodorants, Comet cleaner, Aqua Net styling products, Pert Plus shampoo and Rit dye.
As the pace of deals has quickened, it has become clearer just what works and what doesn't in nursing a so-called orphan brand back to health: acquire prominent brands, dominate niches, reinvigorate marketing and develop new products bearing the old trusted name.
Picking the right brand in a clearly defined niche is critical. "Sometimes brands have been orphaned because they're in too small a category for their big owners," says Bill Chappell, a SunTrust Robinson Humphrey analyst, citing Prestige Brands Holdings Inc.'s dominance in wart removers, where it owns two brands, including Compound W. Small niches can be carved out of bigger categories, too, Mr. Chappell says, noting Prestige-owned Comet, which is a leading brand among abrasive household cleaners that sell for about $1.
"It's simply a matter of focus," says Rick Milenthal, chairman of TenUnited, a Columbus, Ohio-based marketing agency that specializes in campaigns to revive old brands, including Chloraseptic sore-throat treatment, Prell shampoo and Comet in recent years, and is now working on boosting Pert Plus and Sure deodorant. "If you can fund marketing and fund distribution, you're going to have success," he says.
With Chloraseptic, Mr. Milenthal says focusing on how consumers hate staying home when they're ill helped to inspire new products. Developing new medications that can be taken on the go, including dissolvable strips in compact boxes, helped to distinguish Chloraseptic from competitors, he says.
Pitfalls abound, though. As major retailers narrow their inventories to just a few leading brands and their own private labels, smaller players often get nudged aside. "Companies run into the biggest problems when they acquire a No. 3 or 4 brand in a very large market," says Mr. Chappell.
[Innovative Brands is giving retailers more choices of Sure deodorant.]
Innovative Brands is giving retailers more choices of Sure deodorant.
Even when operating in niche categories, success can be elusive. Prestige, which also owns Prell, Cutex nail-polish remover and Spic and Span cleaner, this week gave notice that its fourth-quarter results would be lower than the year before, blaming declining revenue in its personal-care business and a weaker-than-anticipated cold and cough season.
At a conference this week, Chairman and Chief Executive Mark Pettie kept an optimistic tone, outlining a number of growth strategies under way. Those include plans to broaden retail distribution, better focus research and development on fewer and bigger ideas, as well as reduce the number of suppliers in order to gain purchasing efficiencies and scale.
Providing better service to retailers can also win advantages for smaller brands, says Jahm Najafi, CEO of Najafi Cos., a private investment firm whose portfolio company, Innovative Brands LLC, last year bought Sure and Pert Plus from P&G.
"There is opportunity to focus on them in more of a small, entrepreneurial company," he says of the brands. Early efforts to revive Sure and Pert Plus have focused on giving retailers more choices, including customized fragrances. He anticipates his company will be acquiring more brands in the near future.
To resurrect the Coleman brand, Mr. Franklin decided he needed to develop more points of distribution and a fresh ad campaign. He hired a new division leader, Gary Kiedaisch, an avid outdoorsman who first focused on rallying employees, many of whom had become disillusioned with the neglect it got from its string of former owners.
Mr. Kiedaisch was also waging a bigger campaign, trying to convince more consumers to enjoy nature. "When they see Coleman's in-store merchandising, it should inspire them to go outdoors," he says.
To bring the brand back upscale and win over more serious campers, Coleman offered specialty retailers several new products unavailable in mass-market chains.
"Coleman three years ago wouldn't have gotten into our stores," says Jim Potts, co-founder of Lewis & Clark Outdoors Inc., a chain of outdoors stores in Arkansas. "They weren't well-respected by outdoor enthusiasts, and there were questions about the quality of the product."
But after hearing about Coleman's new products targeting more serious campers and hikers, Mr. Potts reconsidered. Last month, his stores launched a large display of Coleman products that can't be found at the Wal-Mart stores nearby, including high-quality folding chairs and compact gas stoves. Now that he's in the peak-selling presummer season, he says sales of Coleman products have been strong. Coleman sales last year grew 10% to $901 million, and operating income rose nearly 10% to $84 million
[Chloraseptic, long known for its throat spray, has been spun into an array of products by Prestige Brands.]
Chloraseptic, long known for its throat spray, has been spun into an array of products by Prestige Brands.
This week, Jarden acquired another outdoor-goods company, Pure Fishing Inc., a maker of fishing tackle, lures, rods and reels with brands including Berkley, Abu Garcia and Trilene. These brands will keep their names, but will be placed under the Coleman umbrella and be promoted along with those products.
Skis with a beer holder built into the top sheet?