Italian FILA’s pencils and felt pens have prevailed over the brushes and tempera paints of English industry leader Daler-Rowney, forming one of Europe’s largest arts & crafts groups.
The company announced last week it has purchased 100% of the share capital of Renoir TopCo Ltd, the holding company that controls the Daler-Rowney Lukas group, which has £60 million in revenue and over 700 employees worldwide, specializing in the manufacture and distribution of acrylic tempera paints, paintbrushes and art supplies.
The purchase, from funds managed by Electra Partners Llp and Daler management, is worth €80.8 million, financed in the medium-long term by UniCredit, Intesa Sanpaolo and Mediobanca for an overall amount of €130 million.
“The remaining €50 million will serve as working capital, and to seize the many opportunities the market offers right now,” said Massimo Candela, FILA controlling shareholder and CEO. “The banks have given us the means to make more acquisitions in markets where we wish to grow further, such as the Anglo-Saxon countries, France, Germany, Brazil and South America as well as continental Europe.”
With the purchase of Daler – whose markets include the UK, Germany and the US, where they are the main supplier of art materials for Walmart – FILA strengthens its presence in the US in particular, making this the premier market for the Italian group which comprises such brands as Giotto, Tratto, Das and Pongo, and counts 11 factories worldwide (two of which in Italy, in Pero and near Florence) and 19 branches, employing 5,000 people overall.
FILA turnover in 2014 was €233.6 million with €40 million EBITDA; over the first nine months of 2015, it showed an 18% growth that was confirmed in the fourth quarter, and is therefore expecting to surpass a turnover of €270 million. Add to that Daler-Rowney revenues and the FILA group is looking to be worth over €350 million.
“We wish to broaden our range of products to satisfy the demand of the world’s major art material retailers,” says Candela.
Hence the acquisition of Daler, historic firm founded in 1783 with a product offering that complements FILA’s.
The arts & crafts sector, affected by the recession only in the recent past, later than other industries, is experiencing major changes. There are a great number of companies up for sale all over the world, said Candela, niche businesses with fragmented distribution that have no appeal for the large corporations but could appeal to a structured, multinational group like FILA. So his goal is to create similar synergies as the one that’s just been achieved with Daler-Rowney.
“We'll be manufacturing internally, in our own production facilities, what the English company formerly bought from external suppliers,” Candela concludes.
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