06 Aug 2007 Rutland Acquires Pulse Home Products
Rutland Partners LLP (“Rutland”), the UK private equity partnership, announces that it has exchanged contracts to acquire Pulse Home Products Limited and the business of certain other domestic appliance brands (together “Pulse”) from Alba PLC for a total consideration of £51.5 million. The transaction is conditional, inter alia, on the approval of Alba shareholders at an EGM.
Pulse is one of the leading providers of branded goods to the UK home products market with a portfolio of brands including Breville, Nicky Clarke, JCB, Bush, Dirt Devil, Hinari and Power Devil. It designs and innovates the majority of its products which are then manufactured by third party suppliers in the Far East. Pulse sells to a wide range of multiple and catalogue retailers in the UK. Following its acquisition by Alba in 2001, Pulse’s logistical and administrative operations were integrated into the activities of Alba and arrangements have been agreed between the parties to transition Pulse to a truly stand-alone business following its acquisition by Rutland.
The management of Pulse is led by David Allen who has been with the business since 1993 and a plan will be implemented to roll-out management best practice to improve the performance of certain brands which, historically, have not been under the control of the investing management. In parallel, additional resources will be made available to exploit the growth potential of the stronger brands and to implement the actions and controls necessary for the efficient operation of an independent business. On a pro forma stand-alone basis, Pulse is estimated currently to be generating an EBITDA of approximately £9.4 million on sales of £118 million.
Rutland is investing approximately £25 million from its second fund, Rutland Fund II, to support the acquisition with the balance of the funding coming from debt facilities provided by CIT Capital Finance (UK) Limited.
Commenting on the investment, Mike Harris of Rutland said:
“We are delighted to have agreed the acquisition of Pulse and to have the opportunity to support David Allen and his team in their strategy to transition the business to independence and to improve its performance by maximising the untapped potential in its diverse range of brands and products.”
David Allen, CEO of Pulse, commented:
“The Pulse management team are excited by the potential for Pulse that will stem from this transaction. We are looking forward to working with Rutland who we see as an ideal funder for this type of situation and, undoubtedly, will be a valuable contributor to the future plans for the business.”
The transaction was led on behalf of Rutland by Mike Harris and Ben Slatter (who will both join the Board of Pulse) and by Nick Morrill and Dan Freed.