Nobia acquires leading French kitchen retailer Hygena Cuisines
Published 14 February 2006
Hygena Cuisines ("Hygena") is one of the leading kitchen retailers in France with a well-known brand and 138 wholly owned stores in its network.
Nobia gains a significant presence in the French kitchen market, while reinforcing its position in Continental Europe.
Hygena's sales in 2005 were approximately SEK 1,800 million (EUR 195 million). With a market share of approximately 11 percent, the company is one of the market leaders in France in terms of kitchens sold.
Positive earnings per share development is expected from the first year.
Nobia anticipates positive synergy effects by 2007/2008 from the leverage of its own sourcing capabilities.
Nobia and MFI Furniture Group Plc ("MFI") concluded a transaction in which Nobia has acquired MFI's French kitchen retailer Hygena for a total consideration of SEK 1,255 million (EUR 135 million) including cash in the acquired company. The acquisition increases net debt by approximately
SEK 1,150 million.
Hygena sells kitchen interiors in France ranging from the high-volume low price segment to the upper-middle price segment through its own network of 138 stores. Hygena offers complete kitchen and bathroom solutions based on flat-pack products, with a range of optional services that include full-service installation. The number of kitchens sold in 2005 amounted to approximately 60,000, rendering Hygena one of the leading retailers in France by volume. The kitchens sold are branded under the Hygena name and are currently sourced from MFI or other well-known French and foreign suppliers. Hygena does not have its own production facilities. The company employs 900 people and is headquartered in Lille.
Hygena's sales in 2005 were approximately SEK 1,800 million (EUR 195 million), which would represent a 14 percent increase of the Nobia Group's sales in 2005. The combined sales of Nobia and Hygena would amount to SEK 14,200 million. Hygena will be part of Nobia's Continental European business region and the acquisition would not have affected the operating margin of this business.
Since 2003, Hygena has achieved an annual organic growth rate of 8.3 percent, strongly supported by an ongoing refurbishment of its store network. At present, 98 of its 138 stores have been successfully modernised and modest investments are expected to complete the refurbishment program. Total store area is 47,000 square metres.
Nobia anticipates positive synergy effects by 2007/2008 from the leverage of its own sourcing capabilities. A positive earnings per share development is expected during 2006.
"This is an important strategic move for Nobia. By acquiring Hygena Cuisine's extensive operations, we will strengthen our foothold in Continental Europe, while establishing a solid platform for growth in the French market. Developing a strong and inspiring retail network is an important part of our strategy. This acquisition brings the grand total of directly operated stores to 695 in the Nobia Group, representing about 75 percent of our total sales. Furthermore, the acquisition of Hygena increases the synergy potential within Nobia," says Fredrik Cappelen, President and CEO of Nobia.
Matthew Ingle, CEO of MFI, comments, "This is an excellent deal for MFI, as well as for the employees and customers of Hygena Cuisines. We are very proud of what the business has achieved under our ownership and I am confident that it will continue to flourish as part of Nobia."
Nobia intends to retain Hygena's current management team and does not foresee any change in the number of employees at the present time.
MFI will continue to be a supplier of certain kitchen furniture products over the next three years and will also provide IT services to Hygena during a transition period. Nobia gains the right to use the brand in Europe excluding the UK, while MFI retains the right to use it elsewhere.
For further information, please contact:
President and CEO Fredrik Cappelen or Executive Vice President Lennart Rappe
at +46 8 440 16 00.
Facts about the French kitchen market
The French kitchen market represents approximately 10 percent of the Western European kitchen market in terms of value.
About 600,000 kitchens are sold per year.
The growth rate during the past two years has averaged at roughly 6 percent, compared with a European average of about 3 percent.
The penetration rate of modern kitchens in French households is relatively low.
Kitchen sales per capita are still among the lowest in Europe.
Invitation to telephone conference
Nobia will hold a telephone conference today at 10.30 CET, at which the President and CEO Fredrik Cappelen and Executive Vice President Lennart Rappe will present and comment on the acquisition of Hygena Cuisines.
The telephone conference will be held in English.
Time: 10.30 CET
Call-in number: +44 (0) 20 7138 0836