Aga Foodservice Group plc has acquired Northland-Marvel, a U.S. manufacturer of high-end domestic and commercial refrigeration appliances, for U.S. $21 million (£13.3 million) in cash.
According to Aga, the acquisition will enable it to offer dealers and consumers a range of cookers and refrigerators comparable to that of the established US market leaders.
Northland-Marvel's primary production facility is in Richmond, IN, U.S., and it produces undercounter and freestanding refrigerators. In the financial year ended Oct. 31, 2002, Marvel’s turnover was $40 million and profit before tax was $3.0 million. Profits are expected to be up to $0.5 million lower in the current year, but should strengthen moving into 2004. Net assets as of Oct. 31, 2002 were $7 million.
Northland-Marvel will report to Iain Whyte, managing director of Aga Foodservice Inc. and Victory Refrigeration. Gordon Stauffer, Northland-Marvel's CEO, will remain with the business for the next 3 years prior to his retirement.
In the U.S., there are more than 200 Aga displays and 12 Aga/Domain stores showing the company’s 'Great Room' setting. As a result of this acquisition, Aga said it will build on this platform and on the distribution structures of Northland-Marvel, in turn, widening the product range carried by both and adding more cooking products from Rangemaster in the UK. Northland-Marvel's commercial sales, which account for around 14 percent of the business, will benefit from the link with Victory, and new ranges will be launched in 2004, Aga said.
With Northland-Marvel, Aga also plans to develop a presence internationally in upscale domestic refrigeration. Northland-Marvel product will be sold in the UK through the Aga’s established routes to market under the Aga and Falcon brands.
William McGrath, CEO of Aga Foodservice Group plc said, "With the wider range of cooking and refrigeration appliances on offer, backed by the marketing profile that Domain is providing in the U.S., the [Aga] Group now has the structure to make a real impact. We are taking commercial refrigeration technology into domestic appliance markets, combined with the styling for which we are renowned. Together with our other product ranges led by Aga, we have created a strong commercial opportunity in our US business."
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