News Movado Group has agreed to acquire Ebel, one of the world's premier luxury watch brands, from LVMH, Moët Hennessy Louis Vuitton, in an all-cash transaction valued at approximately $47.3 million (61.5 million CHF), subject to closing adjustments. The transaction is expected to close during the first quarter of calendar 2004.
Founded in Switzerland in 1911, Ebel is a world-class brand globally recognized for its iconic product designs, technological innovation and superior quality. The brand, which is expected to generate approximately $65.0 million (85.0 million CHF) of net sales in calendar 2003, is currently sold at price points in the $1,500 to $10,000 range in approximately 1,800 doors worldwide. The Ebel business will remain based in La Chaux-de-Fonds.
The addition of Ebel, with its distinctive, internationally recognized watch families such as Beluga and Classic Wave (see photo), is consistent with the Company's strategic goals to extend Movado Group's presence within the luxury watch category and increase its global presence, particularly in Europe and Japan.
Efraim Grinberg, President and Chief Executive Officer, stated, "The addition of Ebel represents a compelling strategic opportunity for Movado Group and marks our first acquisition since the Movado brand in 1983. With a rich heritage recognized by discerning consumers for nearly a century, Ebel is an excellent complement to our existing portfolio of brands. It will significantly expand our presence in the high end of the luxury watch category. At the same time, the transaction is consistent with our overall portfolio strategy of differentiating each of our brands in the marketplace while leveraging production and distribution capabilities."
Rick Coté, Executive Vice President and Chief Operating Officer, commented, "We are very pleased to add this world-renowned brand to our portfolio. Movado Group's strong balance sheet allows the flexibility to finance the acquisition entirely with our cash on hand. Over the past several years, our entire organization has worked diligently to develop an efficient and scalable infrastructure in the US. We see significant opportunities to leverage our strong infrastructure to enhance Ebel's presence in the US. And, with over 70% of its sales outside of North America, Ebel will serve as a solid platform to increase Movado's presence in those international markets we have been targeting for growth, including Germany, the United Kingdom, France and Japan."
January 12, 2004
