Shakespeare Fishing Tackle, a division of K2, Inc., officially acquired Penn Fishing Tackle Mfg. Co. on January 16. In an exclusive interview, Scott Hogsett, president of Shakespeare said that David Martin, who was serving as CFO/CEO, will remain as the head of Penn as general manager and that Penn will be part of Shakespeare, and not reporting directly to K2 Inc.  Most functions will run separate from Shakespeare, but the companies will combine or coordinate other functions such as marketing and advertising. 

According to Hogsett, “The biggest immediate synergies have to do with sourcing, importing, logistics, and freight.  Penn used an outside organization to purchase product and import.  Shakespeare has a logistics department that can pick up this function.  Additionally, we have negotiated better sourcing fees from agents.  Since K2 imports thousands of containers, our overseas freight will be reduced, as well as domestic carrier freight.” 

In addition, Hogsett sees synergies in rod manufacturing and improvements in domestic manufacturing through manufacturing process improvements and implementing a better process for forecasting.

Though K2 does not disclose sales by company, he did say that the combined companies “will become #2 in market share in reels.  We were already #1 in rods, #1 in kits/combos, and now a dominant #1 in rods/reels in the U.S.  Our market share is over 35%.”

“The most obvious reason for the acquisition was to acquire a strong, established, and authentic saltwater brand,” said Hogsett. “There was a need to enter the mid- to high-end saltwater market, which the Shakespeare brand could not accomplish.” He sees two other benefits as well, gaining an experienced engineering staff, as well as expertise in manufacturing precision gears and high-end products. 

As for the competition in the deal, Hogsett disclosed, “Several other companies were looking at Penn, but the owners felt that Shakespeare and K2 could offer the employees and company the best chances to grow and expand in the future.  It was literally a perfect fit to our current brands, with virtually no overlap.”

Finally, Hogsett sees both brands helping the other with distribution. “Penn can help Shakespeare somewhat at the independent dealer level – and Florida in particular – but primarily Shakespeare can gain much more distribution for Penn than they currently have. There are several pockets in the US with little or no Penn distribution.  Our Shakespeare and Pflueger brands have strong national distribution.  Although our sales forces will be separate, we will coordinate key account management to maximize distribution. As part of K2, we can open up doors that previously were shut.”