KPS/Waterford Deal is Done
New Owner Plans to Offshore Jobs; Invest in Acquisitions
By Staff -- Gifts and Dec, 4/7/2009 12:00:00 AM
New York — Private equity company KPS formed a new company called WWRD Holdings to finalize its purchase of bankrupt Waterford Wedgwood. KPS will invest $135.5 million, according to The Financial Times, and leave behind about a million dollars in debt and pension liabilities.
The deal involved operations in 10 different countries, including the US, Japan, Australia and Singapore. KPS is not buying any assets in Ireland except for its stock of products and intellectual property. Nor, according to The Telegraph, is it buying Waterford’s German operations.
Michael Psaros, co-founder of KPS Capital Partners, said, “We are not assuming any revenue growth to achieve profitability. We intend for Waterford Wedgwood to be an acquisition platform in this industry and we're prepared to invest very significant capital in helping to grow the hell out of the business. […] We are going to accelerate transfer of activity from the UK to Indonesia. Labor [there] is 85 percent cheaper than the UK. Real works of art and highest-end products will still be done in Barlaston."
According to consultant Deloitte, the deal saved 1,396 jobs. According to the BBC, Waterford Wedgwood previously employed 5,800 people. WWRD Holdings says it now employs 3,700.
Workers at Wedgwood's Barlaston headquarters have been told there will be no more layoffs for the next 30 to 40 days while new plans for the company are made
At the company’s namesake location in Ireland, workers had been holding a sit-in to protest the loss of jobs; the demonstration was brought to a close on Sunday after workers accepted proposals including the retention of about 170 of the 480 staff in Ireland, mainly in administration and tourism, and about 10 million Euro to be split among those who lost their jobs. However, those still working will be employed by the receivers, not by the new company, according to RTE. The remaining jobs will be reviewed after six months. A consortium of local Waterford-based businessmen is in talks with the Irish government to fund construction of a new crystal factory in the area. However according to the Independent, that process may be hampered by the recent death of Waterford businessman Nicky Fewer, who was leading the consortium.
KPS named Pierre de Villemejane, previously CEO of KPS portfolio company Speedline Technologies, as CEO of WWRD Holdings. The senior management team of WWRD Holdings will consist of executives from Waterford Wedgwood, including Anthony Jones, Moira Gavin and Ralf Kuhn. “We believe that our primary competitors are generally undercapitalised and regionally focused, presenting a significant opportunity to consolidate the industry worldwide," said Villemejane.
As to how all of this affects Waterford Wedgwood USA remains to be seen, although the company is moving forward with business as usual and preparing for the upcoming New York Tabletop Show. Representatives of Waterford Wedgwood USA were unavailable for comment, having been requested by its new owners not to make any statements during this transitional time.
It is sad, sad, sad, that companies such as Wedgwood and Royal Doulton, both with a long history that has been important in the growth of the dinnerware and giftware industry for over 200 years, that we now find that for whatever reasons by whomever(s), took them from what they were to what they are about to be.
Waterford's revival in the 60's made the the fine crystal table and giftware important in the public's minds and eyes. While there were other crystal brands, none carried the penache that they did.
What will be lost if these firms cannot be brought back to the place they deserve, is that they will be on the shelves of stores and tables in homes to enhance everyone's lives.
I'm glad I had the priviledge of being around these museum quality goods for over 25 years. Others will not, unfortunately, have the same priviledge. Sad, sad, sad.
Alan J. Zell - 2009-05-05 18:53:00 EDT
Waterford's revival in the 60's made the the fine crystal table and giftware important in the public's minds and eyes. While there were other crystal brands, none carried the penache that they did.
What will be lost if these firms cannot be brought back to the place they deserve, is that they will be on the shelves of stores and tables in homes to enhance everyone's lives.
I'm glad I had the priviledge of being around these museum quality goods for over 25 years. Others will not, unfortunately, have the same priviledge. Sad, sad, sad.
This is just a lot of none sense! No more lay offs for 30 to 60 days, and
then what? I agree with the poster from Indiana. Who is going to buy
Irish crystal that is not made in Ireland?
Pete - 2009-04-08 16:53:00 EDT
then what? I agree with the poster from Indiana. Who is going to buy
Irish crystal that is not made in Ireland?
At the end of your article it is written that the effect of the deal in the US is unknown. I would just like to comment that they packed up all but 11 of their outlet stores in the middle of the night with out a word to the malls or employees. I personally do not see much of a future for a company that is so shady. And if they think they can succeed in selling Irish crystal that is made in Slovenia they are kidding themselves! Trust me the quality is not the same.
Anonymous - 2009-04-07 20:19:00 EDT
So where does this dynamic team plan to place Waterford? There are
just not enough doors in this business anymore to support a line in
table top or gifts. Waterford is not the company it used to be regarding
style, quality and distribution. People just don't entertain or sit down by
candle light for dinner as they used to, I know the name is magic and it
can go on any old product and it will sell!! I don't think so. Good luck.
Fred - 2009-04-07 11:43:00 EDT
just not enough doors in this business anymore to support a line in
table top or gifts. Waterford is not the company it used to be regarding
style, quality and distribution. People just don't entertain or sit down by
candle light for dinner as they used to, I know the name is magic and it
can go on any old product and it will sell!! I don't think so. Good luck.
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