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Amer Sports acquires Salomon

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HELSINKI, Finland/HERZOGENAURACH, Germany – There have been rumors for a couple of weeks but now its official: The Finish Amer Sports Corporation has made an agreement with German-French Adidas-Salomon AG to acquire Salomon based in Annecy, France. Included in the deal are the brands Salomon, Bonfire, Arc’Teryx, Cliché – and its bicycle component brand Mavic. […]

HELSINKI, Finland/HERZOGENAURACH, Germany – There have been rumors for a couple of weeks but now its official: The Finish Amer Sports Corporation has made an agreement with German-French Adidas-Salomon AG to
acquire Salomon based in Annecy, France. Included in the deal are the brands Salomon, Bonfire, Arc’Teryx, Cliché – and its bicycle component brand Mavic. The combined business will create a leading global sports equipment company with combined sales of € 1.7 billion and 6,800 employees. According to a press release “the acquisition is subject to customary conditions including regulatory approvals”.

The enterprise value of the transaction amounts to approximately € 485 million based on year-end 2004 net assets, and includes € 144 million in goodwill. Amer Sports is financing the transaction with debt, which is expected to bring its gearing ratio to approximately 110% at the Company’s financial year end, 31 December 2005.

Amer Sports expects that the acquisition will have a slightly positive impact on earnings per share in the current fiscal year as well as in 2006. It is expected that the transaction will be completed by the end of September 2005.

Salomon achieved total sales of € 653 million and an operating profit of € 9 million in 2004 which included a restructuring provision of € 19 million. Salomon is a significant player in action sports equipment and is well-established in technical apparel and footwear. Due to the latest integration of Adidas-Cycling and Salomon’s Mavic into Mavic-Adidas Cycling it is still a question how Amer and Adidas will handle this product category.

To assure Salomon’s smooth separation from the Adidas-Salomon organization, it has been agreed that the parties will cooperate during a transition period of up to three years.

Amer Sports is a leading European sporting goods supplier based in Finland. After selling its tobacco business, the company is concentrating on the sporting goods sector. Currently Amer Sports owns the Atomic Group (wintersports), Wilson (racket sports and basket ball), Suunto (sports measuring instruments) and Precor (fitness equipment). (JB)

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