Armor Holdings, Inc. has reached a definitive agreement to acquire Bianchi International, a privately- held manufacturer and supplier of duty and concealment holsters, belts and accessories under the Bianchi® brand name used primarily by law-enforcement, private security and military personnel. A supplier of the SPEAR rucksack system for U.S. Special Operations Forces, the Company is also a market leader in medium and large technical internal frame backpacks and high-end daypacks, satchels and carrying cases under the Gregory® brand name.
Armor Holdings will pay $60 million in cash for the Company, which will be delivered on a debt-free basis. Bianchi recorded $36 million in revenue for the twelve months ended September 30, 2004. The transaction, which is subject to regulatory approval and other customary conditions, is expected to close during the fourth quarter. Upon completion of the transaction, Bianchi will be consolidated into Armor Holdings' Products Division. The transaction falls within Armor Holdings' previously disclosed valuation parameters and is expected to be immediately accretive to earnings per share.
Robert Schiller, President and Chief Operating Officer of Armor Holdings, Inc., said, “This is an excellent acquisition for us from a number of standpoints. First, Bianchi alone is a healthy business with a stable history of revenue growth and cash flow generation. Second, because Bianchi is complementary to our existing law-enforcement product categories, we believe there is an excellent opportunity to grow the business and increase its profitability through integration. From a distribution perspective, not only do we expect to be able to increase Bianchi's penetration into the law- enforcement market through our highly developed distribution network, but we also believe that the acquisition gives us an opportunity to further expand our efforts to increase penetration for military duty gear. With the strength of our SAPI program and the recently announced agreement to acquire Specialty Defense for the Outer Tactical Vest, the MOLLE Pack System and Warrior Helmets, we believe Bianchi solidifies for us an ever-stronger position in this market. Finally, we believe that the consumer market opportunity for the Gregory® brand, which enjoys an excellent reputation amongst outdoor enthusiasts, is compelling.”
Gary French, Chief Executive Officer of Bianchi International said, “We are excited to be joining forces with what we consider to be one of the strongest companies in the law-enforcement products market worldwide. In addition to its solid business model and great leadership, we believe that Armor Holdings will open new doors through research and development efforts and expanded distribution that we could not have achieved on our own. I look forward to this new chapter in the development of our brands and our business.”
Mr. Schiller concluded, “Bianchi, with its leading brands, excellent management team, and many opportunities for growth, is a solid fit with our organization and consistent with our rather stringent acquisition criteria. We expect to continue to deploy our capital in the most thoughtful and strategic manner possible.”
Armor Holdings, Inc. is a publicly traded company on the New York Stock Exchange, under the symbol, AH. The company is a diversified manufacturer of military, law-enforcement, and personnel safety products.
