Sanderson Acquisition Hopeful "Turning Point" for Reshaped Walker Greenbank
January 30, 2004
MILTON KEYNES, Buckinghamshire — Wallcoverings and home textiles supplier Walker Greenbank foresees a lucrative future following the acquisition last year of Arthur Sanderson & Sons, one of the British textile industry's most prestigious names.
The Milton Keynes-based home furnishings group bought the business and certain assets of upscale wallpaper and fabric maker Arthur Sanderson & Sons, whose archives include designs by William Morris, for £5.5 million ($10 million) at the end of August 2003.
Several British companies had made offers to buy Sanderson. The British national newspaper Mail on Sunday erroneously reported the day before the sale was announced that Crowson would pay about £10 million ($18.2 million) for the bankrupt company.
The acquisition adds five key brands — Sanderson, Morris & Co., Studio Sanderson, Design Essentials and V&A Museum — to Walker Greenbank's existing Harlequin and Zoffany brands and the group's U.K. manufacturing facilities at Anstey Wallpaper in Loughborough and the Standfast-Barracks fabric printing operation in Lancaster.
With annual sales of around £22 million ($40 million), Sanderson slipped into administrative receivership in mid-2003 after it ran out of money halfway through a restructuring program following a management buyout backed by a Dutch private equity firm.
The Sanderson business, which has held a Royal Warrant to supply fabric to the Royal Household since 1923, will continue to operate from its headquarters in Denham near Uxbridge, Middlesex. This facility also houses a design archive of more than 25,000 items including fabric samples, pattern books and original artwork.
The acquisition of Sanderson, which saved several hundred jobs at the 143-year-old company, could be a turning point for Walker Greenbank, which reported a 16% fall in sales to £20.8 million ($38 million) for the half year ended July 31, 2003. Full-year turnover to January 31, 2003 amounted to £58.3 million ($106 million).
Walker Greenbank chairman Ian Kirkham said the group's fabric and wallpaper printing factories are benefiting from additional sales volumes as a direct result of the Sanderson business, the integration of which is "progressing satisfactorily and in line with expectations." He is confident the group's performance will be "substantially improved" in 2004.
"The full benefit arising from the purchase of Sanderson will not be achieved until the second half of 2004, although early synergistic gains will help to reduce losses in the second half and assist in moving the business towards profitability this year," Kirkham said.
Walker Greenbank targets the top end of the wallcoverings and home textiles market, selling to European countries as well as the U.S. Kirkham said cost reduction and cash generation programs had protected the firm from the full effects of "a very depressed market." "Regrettably, the interior furnishings and decorating market remains flat," he said.
In May, Walker Greenbank sold the fabric weaving business of its Weavestyle and Contract Fabrics unit for £2.8 million ($5.1 million) to private company Project Riverside. This helped raise funds for the Sanderson purchase and reduced the firm's debt to £4.8 million ($8.7 million) — its lowest level since January 2001.
The disposal, acquisition and ongoing cost cutting and debt reduction places the firm in a strong position should any market upturn materialize.
In a further drive to improve results, Walker Greenbank is hoping to complete the sale of the Warner archive of textile designs for £2 million ($3.6 million) to the collection's original owners at Warner's Mill in Braintree, Essex. The deal, which is being funded by the Heritage Lottery Fund, is expected to be completed this year.
Meanwhile, David Medcalf has resigned as chief executive officer of Walker Greenbank due to ill health. Group finance director John Sach has been appointed acting CEO.
The Milton Keynes-based home furnishings group bought the business and certain assets of upscale wallpaper and fabric maker Arthur Sanderson & Sons, whose archives include designs by William Morris, for £5.5 million ($10 million) at the end of August 2003.
Several British companies had made offers to buy Sanderson. The British national newspaper Mail on Sunday erroneously reported the day before the sale was announced that Crowson would pay about £10 million ($18.2 million) for the bankrupt company.
The acquisition adds five key brands — Sanderson, Morris & Co., Studio Sanderson, Design Essentials and V&A Museum — to Walker Greenbank's existing Harlequin and Zoffany brands and the group's U.K. manufacturing facilities at Anstey Wallpaper in Loughborough and the Standfast-Barracks fabric printing operation in Lancaster.
With annual sales of around £22 million ($40 million), Sanderson slipped into administrative receivership in mid-2003 after it ran out of money halfway through a restructuring program following a management buyout backed by a Dutch private equity firm.
The Sanderson business, which has held a Royal Warrant to supply fabric to the Royal Household since 1923, will continue to operate from its headquarters in Denham near Uxbridge, Middlesex. This facility also houses a design archive of more than 25,000 items including fabric samples, pattern books and original artwork.
The acquisition of Sanderson, which saved several hundred jobs at the 143-year-old company, could be a turning point for Walker Greenbank, which reported a 16% fall in sales to £20.8 million ($38 million) for the half year ended July 31, 2003. Full-year turnover to January 31, 2003 amounted to £58.3 million ($106 million).
Walker Greenbank chairman Ian Kirkham said the group's fabric and wallpaper printing factories are benefiting from additional sales volumes as a direct result of the Sanderson business, the integration of which is "progressing satisfactorily and in line with expectations." He is confident the group's performance will be "substantially improved" in 2004.
"The full benefit arising from the purchase of Sanderson will not be achieved until the second half of 2004, although early synergistic gains will help to reduce losses in the second half and assist in moving the business towards profitability this year," Kirkham said.
Walker Greenbank targets the top end of the wallcoverings and home textiles market, selling to European countries as well as the U.S. Kirkham said cost reduction and cash generation programs had protected the firm from the full effects of "a very depressed market." "Regrettably, the interior furnishings and decorating market remains flat," he said.
In May, Walker Greenbank sold the fabric weaving business of its Weavestyle and Contract Fabrics unit for £2.8 million ($5.1 million) to private company Project Riverside. This helped raise funds for the Sanderson purchase and reduced the firm's debt to £4.8 million ($8.7 million) — its lowest level since January 2001.
The disposal, acquisition and ongoing cost cutting and debt reduction places the firm in a strong position should any market upturn materialize.
In a further drive to improve results, Walker Greenbank is hoping to complete the sale of the Warner archive of textile designs for £2 million ($3.6 million) to the collection's original owners at Warner's Mill in Braintree, Essex. The deal, which is being funded by the Heritage Lottery Fund, is expected to be completed this year.
Meanwhile, David Medcalf has resigned as chief executive officer of Walker Greenbank due to ill health. Group finance director John Sach has been appointed acting CEO.
