Private equity firm to acquire Samsonite for $1.7B
Luggage maker Samsonite, a company on the verge of bankruptcy only four years ago, agreed to be bought by private equity firm CVC Capital Partners for $1.7 billion including assumed debt, according to the Boston Business Journal
The company's board and groups that control about 85 percent of Samsonite’s stock have approved the sale, which is expected to close during the company’s fourth quarter in April 2008.
The Mansfield, Mass.-based company has made many efforts to rejuvenate its brand. In 2004, the company brought in Marcello Bottoli, the former chief executive of Louis Vuitton, to revamp Samsonite's image as a luxury brand. The company also received venture capital investments from such firms as Ares Management, Bain Capital, and the Ontario Teachers' Pension Plan.
London-based CVC Capital Partners has 18 offices throughout Europe, Asia and the United States and has more than $15 billion invested in equity capital.
Samsonite is a well-known brand across the United States and Europe. The company manufactures and distributes luggage and travel-related products under its own brand and licenses the American Tourister, Lacoste and Timberland brands.
CVC’s acquisition of Samsonite
gives the 97-year-old luggage company its fifth owner in 21 years.
The company’s principal shareholders - Ares Management, Bain Capital Partners and Teachers’ Private Capital - have all agreed to the transaction, Samsonite said in a statement.
“CVC Capital Partners is delighted to have reached agreement to acquire Samsonite, the world’s leading travel lifestyle brand,” Hardy McLain and Luigi Lanari of CVC said in a joint statement, “We look forward to working with Marcello Bottoli and his team to realize the full potential of the brand. China and India present particularly interesting opportunities for growth.”
If Samsonite develops in accordance with the proposed business plan to rejuvenate the brand, CVC expects that Samsonite will grow significantly and will appeal to the luxury market and Asia.
According to The List database, New York-based Brunswick Group LLC is currently handling CVC Capital Partners’ public relations initiatives, New York-based Initiative has handled Samsonite’s media buying and planning since 2005 and Miami, Fla.-based BVK/MEKA has handled the company’s Hispanic marketing initiatives since 2003.
According to Nielsen Monitor-Plus, Samsonite spent approximately $14.6 million on national advertising in 2006. About $13.6 million was spent on national magazine ads, $600,000 was spent on national newspaper ads and $200,000 was spent on local newspaper ads.
Agencies with an international background and experience might find contract or project work with Samsonite and CVC. Come up with ideas on how to make Samsonite a premier luxury brand that will appeal to various international markets. Think about what type of customer buys Louis Vuitton, Kate Spade or even Prada luggage and try to target that audience. Agencies that have experience in revamping or rejuvenating brands might want to come up with an advertising campaign for the busy international traveler that includes the new chic and glamorous Samsonite luggage line.
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