by Joseph P. Tartaro | Executive Editor
Smith & Wesson Holding Corporation, parent corporation for Smith & Wesson firearms, is moving more aggressively into the broader hunting and shooting accessories model.
In late November, Smith & Wesson announced that it has signed a definitive agreement to acquire Battenfeld Technologies, Inc., an industry-leading provider of hunting and shooting accessories. The acquisition, which is expected to be accretive to Smith & Wesson gross margins, earnings per share, and cash generated in fiscal 2016, is expected to close in mid- to late December.
Alabama DPS deploying Beretta Tactical Shotgun
Beretta USA Corp. announced on Dec. 8 that the Alabama Department of Public Safety (DPS) has chosen Beretta’s new Model 1301 Tactical as the agency’s primary semi-automatic shotgun. DPS has placed an order for 657 units of the Beretta 1301 Tactical Shotgun which was launched at the January 2014 SHOT Show. The 1301 Tactical has a 18.5” barrel and features a sturdy, protected ghost-ring sight as well as a gas-operated action capable of firing 4 shots in less than a second. It features a top-mounted MIL-STD-1913 Picatinny rail as well as user-adjustability for length of pull, drop and cast.
The agreement provides for Smith & Wesson to acquire Battenfeld Technologies for $130.5 million in cash, subject to certain adjustments. Based in a 145,000 square foot facility in Columbia, MO, Battenfeld Technologies develops and sells shooting, reloading, gunsmithing, and gun cleaning supplies under several popular, premium brands, including Caldwell® Shooting Supplies, Wheeler® Engineering, Tipton® Gun Cleaning Supplies, and Lockdown® Vault Accessories.
Battenfeld Technologies maintains a product development team that has an established track record of launching high-quality, innovative products across its brand portfolio. As a result, its products maintain a prominent position with several independent retailers as well as large sporting goods retailers, including Cabela’s, Bass Pro Shops, Dick’s Sporting Goods, and Gander Mountain. Battenfeld products are also available at internet retailers, including amazon.com and MidwayUSA, the S&W press release noted.
Battenfeld Technologies was founded 22 years ago and since 2006 has generated a largely organic compound annual revenue growth rate in excess of 18%, fueled by sales of newly developed products. In addition to this strong organic growth, the company has also expanded by successfully acquiring small, specialty, hunting-related accessories companies, such as BOG-POD® and GoldenRod®. BOGgear has been a leading manufacturer of monopods, bipods and tripods for shooting, photography and videography since 2006.
James Debney, Smith & Wesson President and CEO, said, “Battenfeld Technologies provides us with a unique opportunity to acquire a thriving company that fits perfectly within our core firearm business. It also allows us to move more strongly into the hunting vertical as well as establish a strong platform for growth in our existing firearm accessories business, which has been a small but highly profitable part of our company. Most of the growth of Battenfeld Technologies has occurred organically, which is a testament to the robust product development capability that Jim Gianladis, the Chief Executive Officer of Battenfeld Technologies, and his team have established. That capability, combined with Battenfeld Technologies’ sophisticated sourcing and distribution infrastructure, should provide a solid framework for organic and inorganic growth as the new accessories division of Smith & Wesson.
“Our intention, Debney continued, “is that eventually all existing Smith & Wesson®, M&P®, and Thompson/Center Arms™ accessories will be housed within this new division. As we continue to expand further into the hunting category, we expect that our accessories businesses will benefit from Battenfeld Technologies’ sourcing and distribution efficiencies and established expertise in new product development.”
Jim Gianladis, who joined Battenfeld in 2007, will serve as the President of Battenfeld Technologies and will report directly to Debney. The Battenfeld Technologies management team and workforce, as well as its base of operations, will continue in Columbia, MO. Gianladis said, “We are very excited to join the team at Smith & Wesson. At Battenfeld Technologies, we have built a robust hunting and accessories business based upon our premium product quality and innovation. We believe that makes us a perfect fit for Smith & Wesson, a legendary company with an iconic brand, world-class products, and broad markets that span consumer, law enforcement, and international channels. Together, we have the opportunity to further expand our business and achieve a new level of success.”
The purchase price for Battenfeld Technologies will be paid using existing cash balances and cash from a $100 million draw on Smith & Wesson’s existing line of credit, which has been expanded to $125 million as a result of the company’s partial exercise of the accordion feature on that line of credit. Battenfeld Technologies is being acquired from Clearview Capital, a private equity firm based in Connecticut.
