Hooker Furniture to acquire Home Meridian International for $100 million
Published
Martinsville-based Hooker Furniture Corp. plans to acquire the business of North Carolina-based Home Meridian International for $100 million.
The deal, the largest in Hooker’s 91-year history, is expected to more than double the size of the company and make it one of the nation’s top five furniture companies.
Home Meridian International (HMI) is the parent company of five business units, including Pulaski Furniture, Samuel Lawrence Furniture, Samuel Lawrence Hospitality, Prime Resources International and Right 2 Home.
Under the purchase agreement, Hooker will acquire substantially all of the assets and certain liabilities of HMI for $85 million in cash and $15 million of newly-issued Hooker stock.
HMI is expected to operate autonomously as a Hooker division. Over the trailing 12 months ending Oct. 31, the combined companies had revenue of more than $550 million. During the same period, combined operating income was $35.6 million.
“HMI’s strategy of providing proprietary products and custom business solutions to large customers and alternative channels of distribution, as well as growth in its traditional business, has yielded a compound average annual sales growth rate of over 15 percent during the last four years,” Paul B. Toms Jr., Hooker’s chairman and chief executive officer, said in a statement. “Growing sales at three times industry average is validation of their strategy.”
HMI will be led by its current CEO, George Revington, and his management team. Revington will be president and chief operating officer of the HMI division.
HMI’s headquarters will continue to be in High Point, N.C., while Hooker’s headquarters will remain in Martinsville.
The combined company will have upholstery manufacturing facilities in Hickory, N.C., and Bedford, plus showrooms in High Point and Ho Chi Minh City, Vietnam, and eight distribution centers in North Carolina, Virginia, California, China and Vietnam.
Once combined, Hooker Furniture will have approximately 900 employees worldwide.
“While there will be no merger of operations or change in customer-facing services, we do see opportunity to improve each company by sharing best practices and looking for ways to work together to lower costs, improve efficiency and grow sales,” Toms said.
In connection with the deal, Hooker has arranged $90 million in debt financing from Bank of America.
