Two luggage makers that also supply bags in the promotional products and incentive markets are coming together, as Samsonite agreed yesterday to a deal to acquire Tumi. The transaction is reported to be for approximately $1.8 billion and it is expected to close in the second half of 2016, pending shareholder approval. In its largest deal since becoming a public company in 2011, Samsonite will pay $26.75 per share for Tumi in an all-cash transaction, which represents a 33% premium to Tumi’s closing price the day before the deal.
"This is a transformational acquisition for Samsonite,” said Ramesh Tainwala, Samsonite’s CEO, in a statement. “It will meaningfully expand our presence in the highly attractive premium segment of the global business bags, travel luggage and accessories market.”
In 2015, Tumi’s sales totaled $548 million, which was a 4% increase over the previous year. The company’s North American business accounted for 68% of its 2015 net sales, while the Asia Pacific accounted for 17%, and the combination of Europe, Middle East, Africa and Latin America accounted for the remaining 15%.
"This is an exciting day for Tumi and all the travelers around the world who count on us," said Jerome Griffith, Tumi’s CEO. "The team at Samsonite has a long and successful track record when it comes to acquisitions and we know they will be excellent stewards of the Tumi brand."
In the promotional products and corporate gifts market, Samsonite and Tumi are carried by multiple suppliers. In ASI’s ESP Web product search program, Indigo (asi/62560) is listed as one supplier that carries products from both companies. Dean Resnekov, president of Indigo, told Counselor that he believes it will be business as usual for how both brands operate within the promotional and incentive sectors (also often referred to as corporate markets).
“The first thing to understand is that what we call ‘corporate markets’ is a tiny part of what two rather large retail brands do,” Resnekov said. “They will decide how to position all of the other segments of their businesses first, so I think it is premature to make too many predictions about any impact within our marketplace. I would just say that both are viable brands and do a considerable business, and I would imagine that is not going to change.”