From Home Furnishing Business
Dorel Completes Acquisition of Lerado Group
The purchase price was $120 million and was funded from proceeds of Dorel's offering of convertible unsecured debentures.
With the closing of the transaction, the maturity date of the debentures is automatically extended to Nov. 30, 2019. Lerado Group is a subsidiary of Lerado Group (Holding) Co. Limited, a publicly traded company listed on the Hong Kong Stock Exchange, specializing in the design and manufacture of a wide range of infant and juvenile products.
"This acquisition will improve Dorel Juvenile's value chain and is a sound investment in our future," said Martin Schwartz, Dorel president and CEO. "Lerado Juvenile will ensure that we continue to further grow our industry leadership and it will augment profitability within the second year of operations.
"We have had a transition team in place in China since shortly after the transaction was announced in June, headed by a seasoned industry veteran from Asia who now becomes responsible for all operations," he said. "The production of several products has already been shifted to Lerado from other suppliers."
The company said the transaction will allow Dorel to be more flexible in the changing landscape and to deliver product to market faster.
The acquisition will also allow the company to integrate its production capabilities and strengthen its supply chain management.
The purchase provides Dorel with its first company-owned factories in Asia and includes four extensive facilities. The factories are based in China and a research and design center in Taiwan, the total assets encompassing over 2.5 million square feet of modern resources.
"These new facilities will complement our existing facilities worldwide and will allow us to best service Dorel's existing customer base. We also look forward to continuing to supply Lerado Juvenile's current customers at a service level that they have come to expect," Schwartz said.