According to Genlyte's announcement, approximately 80 Strand US employees located in Los Angeles and 22 employees in Hong Kong will join the Genlyte organization. The UK operation is in the hands of administrators KPMG, under Jane Moriarty and Blair Nimmo. KPMG has confirmed to LSI Online that 60 reduncancies have been made in the UK, and it is not thought that anyone from the UK operation is being retained by Genlyte.
In 2005, the Strand business segments included in the transaction reported sales of approximately $31 million. The transaction purchase price includes a cash price of $8.5 million plus the assumption of approximately $5.0 million in trade payables and notes payable of the US and Hong Kong operations.
Larry K. Powers, president and CEO of Genlyte Group, commented: "We are pleased with the strategic benefits of this acquisition. This business will complement Genlyte's current Vari-Lite, Entertainment Technology, and Lightolier Controls product offerings. In addition, it broadens our presence in the Asian theatrical and entertainment lighting markets. We plan to operate Strand Lighting as a stand-alone business reporting to Steve Carson the vice-president and general manager of Genlyte's Controls, Vari-Lite and Entertainment Technology Division. We believe that this acquisition will break-even at the EBIT [earnings before interest and tax] level, but it will be slightly dilutive after interest expense and taxes through the remainder of 2006. We anticipate that the acquisition will be accretive during 2007 after we complete the restructuring activities."
Steve Carson said: "We are excited about the opportunity to add the Strand Lighting brand and technologies to our portfolio. The addition of the Strand product line for the theatrical and architectural lighting markets completes our product package with excellent synergism and little overlap. While we look to expand our overall market penetration, we plan to continue to sell the Strand products through the existing Strand distribution and sales organizations. Genlyte's Vari-Lite and ET product lines have a significant presence in the European, Asian, and US markets. The Strand acquisition will enhance our product offering throughout the world."
Strand was founded in 1916 as a manufacturer of entertainment lighting and lighting systems. The transaction includes but is not limited to the following product lines: C21 and CE21 Sine Wave Dimmer Racks, 6pack/3pack dimmer, Wallrack Dimmer cabinets, 500 series Control systems, Palette Series control consoles, and the SL series of Profile spot Luminaries.
The Genlyte Group Inc is a leading manufacturer of lighting fixtures, controls, and related products for the commercial, industrial and residential markets. Genlyte sells lighting and lighting accessory products under the major brand names of Capri/Omega, Chloride Systems, Crescent, Day-Brite, Gardco, Hadco, JJI Lighting, Ledalite, Lightolier, Lightolier Controls, Lumec, Shakespeare Composite Structures, Stonco, Thomas Lighting, Vari-Lite, Wide-Lite, and Canlyte.
(Lee Baldock)
