Samsonite LLC Acquires TUMI
Samsonite LLC, Hong Kong, announced that it has acquired TUMI, South Plainfield, N.J., in a cash transaction worth $1.8 billion. This is Samsonite LLC's largest acquisition since its initial public offering in 2011, according to CNBC.
Samsonite LLC will pay $26.75 per share in the transaction, representing a 33 percent premium of TUMI's closing price.
With this acquisition, Samsonite LLC will add TUMI's higher-end product offerings, some of which start at $500. According to The Washington Post, Samsonite LLC hopes this will give the company a stronger presence in the upscale luggage market.
"This is a transformational acquisition for Samsonite," Ramesh Tainwala, CEO of Samsonite LLC, said in a statement. "It will meaningfully expand our presence in the highly attractive premium segment of the global business bags, travel luggage and accessories market."
David Schick, a retail analyst at Stifel, told The Washington Post that this is a good move for TUMI, as becoming part of a larger brand can increase scale and efficiency.
"This is an exciting day for TUMI and all the travelers around the world who count on us," Jerome Grifith, CEO of TUMI, said in a statement. "The team at Samsonite has a long and successful track record when it comes to acquisitions, and we know they will be excellent stewards of the TUMI brand. Samsonite will bring TUMI to new and growing markets, while still maintaining the high quality TUMI is known for."
"TUMI is a perfect strategic fit for our business," Tainwala said in the statement. "The brand is beloved by millions of loyal customers for its high quality and durable premium business and luggage products. We are excited about the tremendous opportunities this combination provides us to further diversify our product and customer portfolios."
In the press release, Samsonite LLC detailed the long-term goals of the acquisition, including expanding wholesale by introducing the TUMI brand to new customers in more markets worldwide. This would include expanding the brand in Europe and Asia, and strengthening the platform in North America.
The two parties expect the deal to close in the second half of this year, pending shareholder approval.