Black Diamond Inc. CEO talks acquisitions

After successfully raising nearly $60 million in a secondary stock offering Thursday, Black Diamond Inc. CEO Peter Metcalf told SNEWS the company’s expansion plans are on track with at least one “meaningful acquisition” slated for 2012.
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After successfully raising more than $60 million in a secondary stock offering Thursday, Black Diamond Inc. CEO Peter Metcalf told SNEWS the company’s expansion plans are on track with at least one “meaningful acquisition” slated for 2012.

“We’ve already indentified possible companies,” Metcalf told SNEWS. “Can I guarantee that we’ll close a deal in 2012? No, but it’s highly likely.”

Metcalf said Black Diamond’s Scot Carlson and Mike Schultz are leading the effort to search for possible acquisitions. On Wednesday, as previously reported by SNEWS, company officials laid out parameters of target companies, including brands with annual revenues between $25 million and $50 million, highly technical, quality products, concentrated geographic strength, ability to protect intellectual property and strong brand equity/heritage.

Metcalf declined to reveal what product category Black Diamond is looking to expand with a partner, but ruled out apparel. The company plans to debut its own apparel line in fall 2013, and Metcalf said the effort will be Black Diamond driven, not an integration.

“It doesn’t mean we wouldn’t consider a purchase that’s ancillary or accessory to our apparel line,” Metcalf said. He added that Black Diamond’s apparel line will be ramped with sustainability. “We’re not going to release 4,000 SKUs our first season.”

At least one of the company’s acquisitions likely will come in Europe, which company officials described Wednesday as an alpine market “significantly larger than the U.S. market and is highly fragmented by country, with no clear leader across Europe.”

“We see the opportunity for European brands to be part of Black Diamond, which would allow them to grow faster in North America and leverage our presence in Asia,” Metcalf said.

Metcalf said Black Diamond has proved its ability to acquire and integrate brands successfully as it did with Gregory Mountain Products. Although it doesn’t mean that the blueprint will be the same with every acquisition.

“With a larger transaction, we might move them to Salt Lake City (where Black Diamond is headquartered), we might leave them where they are,” Metcalf said.

Metcalf described this week’s successful stock offering as a “healthy testament to the brand.” In addition to possible acquisitions, company officials said they intend to use the money to fully pay off $22.4 million in revolving credit with Zions First National Bank, which matures on July 2, 2013.

--David Clucas

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