Smith & Wesson Holding Corporation (NASDAQ Global Select: SWHC), a leading manufacturer of firearms and a provider of quality accessory products for the shooting, hunting, and rugged outdoor enthusiast, today announced that its Accessories Division, Battenfeld Technologies, Inc., has signed a definitive agreement pursuant to which BTI Tools, LLC, a newly formed, wholly owned subsidiary of Battenfeld Technologies, Inc., will purchase substantially all of the assets ofTaylor Brands, LLC ("Taylor Brands"), a designer and distributor of high quality knives and specialty tools, for$85.0 million, utilizing cash on hand.
Taylor Brands has been a long-standing licensee for both Smith & Wesson and M&P branded knives and is the direct owner of a number of highly-regarded, legacy brands including Schrade, Uncle Henry, Old Timer, and Imperial. Based in Kingsport, Tennessee, Taylor Brands operates from a 160,000 square foot facility.
James Debney, President and Chief Executive Officer of Smith & Wesson, said, "Taylor Brands provides us with an ideal opportunity to further deliver on an important element of our strategic plan, which is to grow our Accessories Division by expanding into adjacent and complementary markets. Established over 40 years ago,Taylor Brands is a recognized provider of high-quality knives and tools under several well-known brands, especially the Smith & Wesson and M&P brands. Taylor Brands has delivered solid growth as well as gross margins that are aligned with those in our existing Accessories Division. We believe that these newly added product lines will benefit synergistically from the product innovation, distribution network, and efficient sourcing model that have contributed to the success of our Accessories Division under the leadership of its President, Jim Gianladis. Today's announcement moves us closer to our vision, which is to become the leading provider of quality products for the shooting, hunting, and rugged outdoor enthusiast."
Jeffrey D. Buchanan, Executive Vice President and Chief Financial Officer of Smith & Wesson, stated, "As a result of our strong balance sheet, we intend to complete the asset purchase of Taylor Brands with cash on hand and we expect the transaction to close in three to six weeks. Due to its anticipated timing, the transaction is expected to have no impact on Smith & Wesson's operational and financial results for the fiscal 2017 first quarter ending July 31, 2016. As of the date of acquisition, Taylor Brands' trailing twelve months revenue was approximately $39.0 million. Without considering any of the significant cost savings that are expected to be realized in our next fiscal year as a result of an acquisition tuck-in of a major licensee, the purchase price represents an estimated multiple of approximately 11x the trailing twelve month EBITDAS. We look forward to providing additional details following the close of the transaction."
Morgan Taylor, President of Taylor Brands, said, "We are proud that the company my family founded in 1975 has grown to become a leading and highly regarded knife and tool provider. We look forward to achieving our next level of growth and continuing to serve our loyal customers as part of Smith & Wesson and with the benefit of Battenfeld Technologies' extensive distribution network and product development processes."
About Smith & Wesson
Smith & Wesson Holding Corporation (NASDAQ Global Select: SWHC) is a leading manufacturer of firearms and a provider of quality accessory products for the shooting, hunting, and rugged outdoor enthusiast, delivering a broad portfolio of quality firearms and shooting, hunting and outdoor accessories, to the global consumer and professional markets. The company's firearms division brands include Smith & Wesson®, M&P®, and Thompson/Center Arms™. As a leading provider of shooting, hunting, and outdoor accessories, including reloading, gunsmithing, gun cleaning supplies, tree saws, and vault accessories, the company's accessories division produces innovative, high-quality products under several brands, including Caldwell® Shooting Supplies, Wheeler® Engineering, Tipton® Gun Cleaning Supplies, Frankford Arsenal® Reloading Tools, Lockdown® Vault Accessories, Hooyman® Premium Tree Saws, BOG POD®, and Golden Rod® Moisture Control. The company's manufacturing services division provides forging, machining, and precision plastic service for outside businesses. Smith & Wesson facilities are located in Massachusetts, Maine, Connecticut, and Missouri. For more information on Smith & Wesson, call (800) 331-0852 or log on to www.smith-wesson.com.
