by Ronnie Dungan
Mega Bloks has acquired arts and craft specialist Rose Art in a deal worth some $350m.
The firm will acquire all of the issued and outstanding shares of Rose Art and its subsidiaries and assume $35 million of outstanding debt for a total purchase price of $350 million.
Rose Art recorded sales of $285 million and income of $43 million for the 12 months ended March 31st 2005.
"Rose Art is a well-managed private company with strong brand recognition in the United State,? said Marc Bertrand, president and CEO of Mega Bloks. ?This acquisition will be immediately accretive to earnings per share, and we expect it to generate accretion of over 15 per cent on a full year basis, before synergies. In addition, we see great opportunities for profitable growth by leveraging our respective strengths and assets in innovation, licensing, merchandising, manufacturing and distribution in the years ahead. We are very pleased that Rose Art's principals, Lawrence Rosen, president and CEO, and Jeffrey Rosen, executive vice-president, have made long-term commitments to be part of the senior management team of Mega Bloks to help us realise these opportunities."
Roseart?s Lawrence Rosen added: "Joining forces with Mega Bloks is the best strategic option for Rose Art to pursue its rapid growth. In 2004, international sales accounted for approximately 10 per cent of Rose Art's business compared to 43 per cent for Mega Bloks. We see a tremendous opportunity to accelerate international sales of Rose Art's products through Mega Bloks' well-established global sales and distribution network.
?Our company has been in our family for over 80 years and we believe the Rose Art brand will thrive in this new relationship. We see an exciting future for the combined company, driven by a common entrepreneurial culture, strong innovation and pride in creating great products," he added.