NEW YORK (The Deal) -- Finnish home and outdoor consumer products group Fiskars (FKRAF) will take tea from Wedgwood tableware and pour port from Waterford crystal decanters after an agreement on Monday, May 11, to acquire the brands from New York private equity firm KPS Capital Partners for $437 million in cash.
The deal follows an auction in which private equity firms Pamplona Capital Management and reportedly Cinven and Searchlight Capital expressed an interest in the company.
Helsinki-listed Fiskars said it plans to buy WWRD Holdings, together with its Waterford, Wedgwood, Royal Doulton, Royal Albert and Rogaška brands. It said the deal will create a strong presence for its Fiskars Living unit in the luxury home and lifestyle products markets in the United States and enhance its position in Europe and Asia Pacific.
"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," it said.
WWRD is official supplier of Wedgwood and Royal Doulton tableware and giftware to the Queen of England, as well as maintaining licensing arrangements with high-profile designers, such as Britain's Jasper Conran.
Fiskars said WWRD generated net sales of $432 million in 2014, with operating profit excluding non-recurring items of $33 million. It had assets of $387.4 million. The combined company would have had pro-forma sales of $1.26 billion.
Fiskars' Functional Products segment was previously the largest of its businesses. However, the acquisition of WWRD's brands will complement the Living segment's existing Iittala, Royal Copenhagen, Arabia and Rörstrand brands and the two segments will henceforth be roughly equal in size.
KPS, which created WWRD when it acquired the Anglo-Irish Waterford Wedgwood out of administration and receivership in 2009, said the $437 million consideration was subject to a post-completion adjustment based on the level of net working capital and cash and debt in the business.
KPS said it did not buy or invest in the existing company in 2009, but rather "created a new company that acquired a collection of deeply undermanaged brands and assets from a failed enterprise." However, at the time it was reported to have raised debt financing for the acquisition from a banking syndicate led by Bank of America (BAC), having taken on the assets, for a reported £82 million ($127.5 million). It said the new company was "unencumbered by Waterford Wedgwood's $1 billion of legacy liabilities."
KPS said it had constructed a new manufacturing facility and visitor center at Waterford in Ireland and was currently in the process of redeveloping the Wedgwood Estate at Barlaston, England.
"The success of WWRD saved approximately 3,800 jobs and preserved an employer vital to all of its stakeholders worldwide," said KPS partner Michael Psaros, in a statement.
Ted Ackerman and Carl Reisner of Paul, Weiss, Rifkind, Wharton & Garrison is legal adviser to KPS. WWRD CEO Pierre de Villméjane and the company are advised by Goldman Sachs and law firm Locke Lord.