Milwaukee - Briggs & Stratton Corp. signed a definitive agreement to acquire Simplicity Mfg. of Port Washington, Wis., for $227.5 million, subject to adjustments.
Simplicity is a designer, manufacturer and marketer of a range of outdoor power equipment used in consumer and commercial lawn and garden applications. Simplicity's products are distributed through independent dealers under the brand names Simplicity, Snapper, Ferris and Giant-Vac. Simplicity had net sales of $285 million for the 10 months ended April 30, 2004 and anticipates
net sales of about $350 million for the 12 months ending June 30, 2004.
Briggs & Stratton expects the acquisition to be accretive to diluted earnings by $.35 to $.45 per share in fiscal 2005 based on preliminary purchase price allocations. Completion of the transaction is subject to conditions customarily associated with a transaction of this type. The transaction is targeted for closing at the beginning of Briggs & Stratton's fiscal 2005 first quarter, at which time Simplicity will become part of the Briggs & Stratton Power Products Group.
"The acquisition is another step in Briggs & Stratton's strategy to present an ever more compelling value proposition to consumers of our products and superior returns to our shareholders. Consistent with the various elements of this strategy, we intend to redouble our efforts to build closer relationships with our OEM and retail customers from an operational, sales and
marketing perspective. We will more aggressively promote our brands to consumers. We will engage our industry-leading service network to provide more effective customer support, and we will continue to extend our cost leadership value discipline to end products," said John S. Shiely, Briggs & Stratton's c.e.o.
Simplicity is Briggs & Stratton's second acquisition in three years that has focused on engine powered products.
"We believe we have proven with our acquisition and subsequent performance in the generator/pressure washer segment that we can deliver on our value commitment to customers and shareholders," Shiely said. "Simplicity is a solid company with several compelling brands, a strong position in the retail dealer channel for outdoor power products and superior product development capabilities. We look forward to utilizing these assets to further our high-value integration efforts with our traditional OEM customer base for mutual benefit."
"We're pleased with the acquisition," said James A. Wier, Simplicity's c.e.o. "We believe Briggs & Stratton has the financial resources and support to allow us to continue our current growth
strategy. The management team and our production facilities will remain in place and continue to focus on delivering high value products sold through the independent dealer channel. We plan to operate as part of Briggs & Stratton Power Products Group and will aggressively seek synergistic opportunities with the entire Briggs & Stratton organization."