Lumber Liquidators acquires operations in China
Toano, Va.-based Lumber Liquidators has agreed to acquire certain assets of Sequoia Floorings relating to Sequoia’s quality control and assurance, product development and logistics operations in China.
In connection with the agreement, Lumber Liquidators expects to retain certain key Sequoia personnel in Shanghai, China, and assume direct control of sourcing previously managed by Sequoia. The acquisition strengthens Lumber Liquidators’ mill-direct relationships pursuant to its long-term sourcing strategy, and allows for a coordinated and efficient transition to direct servicing of mill relationships by a team of quality and product development experts.
"By entering into this transaction, we will be able to better control product cost and quality through our own international sourcing operations, further strengthen our value proposition and increase our competitive position," said CEO Jeffrey Griffiths. "Additionally, we believe that this acquisition will allow us to expand operating margin, while at the same time provide greater flexibility in our marketing programs to help us attract consumers with aggressive opening price points."
Sequoia, a trading company, had provided product quality and development services on approximately 40% of the company’s 2010 merchandise purchases, primarily those in Asia. As part of the transaction, Lumber Liquidators will be opening a representative office in Shanghai upon approval of its application to the Chinese government, expected to occur in October.
The acquisition agreement includes a cash outlay of approximately $5.0 million plus other consideration, such that the expected allocated purchase price is approximately $8.0 million. The company anticipates acquisition-related expenses of approximately $0.6 million, or $0.01 per diluted share, in the third quarter of 2011. The acquisition is expected to be accretive to the business by the fourth quarter of 2011.
Porter-Cable rolls out two new corded products
Towson, Md.-based Porter-Cable has launched two new corded products: a 7 AMP 1/2-in. two-speed hammerdrill (PC70THD) and a 7 AMP 4 1/2-in. small angle grinder/cut-off tool (PC60TPAG). Both the hammerdrill and small angle grinder are designed to offer aggressive performance and a compact, lightweight platform to professionals who are looking for corded power on the jobsite.
“These new corded models deliver performance and ergonomics at the value professionals have come to expect from Porter-Cable,” said Wil Granger, group product manager, Porter-Cable. “Both the two-speed hammerdrill and small angle grinder balance power with comfort and were designed to meet the needs of today’s contractors.”
The hammerdrill’s high output 7 AMP motor delivers the power and durability to complete tough drilling applications. Its dual-mode function operates at 0-1,100/0-3,100 rotations per minute (RPM), respectively, providing two-setting options to complete high-speed and high-torque applications. Available in October 2011 at Lowe’s, Amazon.com and the independent channel, the PC70THD will retail for about $80 and comes standard with a side handle, depth rod and chuck key.
The new 4 1/2-in. small angle grinder/cut-off tool is ideal for contractors, welders, fabricators, masons and other tradesmen whose work includes grinding, metal cutting, polishing and tuckpointing. The grinder’s 7 AMP motor delivers up to 11,000 RPM for tough jobsite applications, while the cast metal gear housing helps to dissipate heat, ensuring that it will stand up to the demands of today’s worksite. The PC60TPAG is now available through Lowe’s, Amazon.com and the independent channel, and retails at about a $60 price point.
NPD U.S. Economic Perception Indicator
The general perception of the U.S. economy in the eyes of the consumer is slightly better than last month, but slightly worse than last year.
Consumer research from Port Washington, N.Y.-based NPD Group shows that consumers remain concerned in September.
The September 2011 NPD U.S. Economic Perception Indicator, a measure of consumer confidence, increased slightly to an index reading of 36.6, on a scale of 0 — "very concerned" — to 100 — "very confident."
The September reading is up from 35.1 in August. A year ago, the perception indicator index was at 38.6.
The NPD Group’s U.S. Economic Perception Indicator measures consumer beliefs about the current and near-term state of the U.S. economy.
Source: The NPD Group Inc./The Economy Tracker