The man behind Lux Group Holdings, the parent company of Smallbone of Devizes, Mark Wilkinson and McCarron & Co talks exclusively to kbbreview about his bid to buy Poggenpohl
Q: Can you confirm that you are bidding to buy Poggenpohl?
A: We can confirm we are bidding and are in final stages.
Q: What exactly are you looking to acquire – is it the entire global entity or is it specific parts?
A: Our interest is in the Poggenpohl brand and its entire global footprint.
Q: Can you give any indication of what level of investment might be involved?
A: We expect to commit resources in excess of €50m to revive the brand and re-engineer the process.
Q: How close are you to completing the deal? What is the timescale?
A: The closure date for the deal is imminent – weeks if not days
Q: Is this purely an opportunistic acquisition or have you been looking to add a contemporary brand to the portfolio for some time?
A: Our goal from the inception of Lux Group Holdings was to add storied brands in many sectors and apply new marketing concepts and selling and manufacturing techniques.
Q: What is about Poggenpohl in particular that appealed?
A: While the brand was managed by various parties, it is our opinion that the former owners did not truly understand the luxury sector and how to market luxury in an efficient manner. Poggenpohl is an ‘Uber Brand’ and has a great future in the proper hands and can excel in the local and international arena.
Q: Can you give any indication of what your plans would be for the company in terms of manufacturing and its retail network if you were successful? What would you do in the short term to turnaround the issues that caused Poggenpohl to fail?
A: The manufacturing of the Poggenpohl brand will remain in Germany. We have rationalsed the Smallbone network and are soon to launch our Flagship concept at Brompton Gate – we expect to deploy similar flagship techniques for the Poggenpohl brand. The ‘new normal’ for retail applies to many segments of the retail sector that are in dire straits and we anticipate increased pressure on the bricks and mortar distribution channels.
Q: How would Poggenpohl fit into the Lux portfolio? Would you keep brands separate in terms of retail and contracts?
A: The Poggenpohl brand is complementary to the other brands that reside within Lux Group holdings. We expect it will remain as a separate holding but of course we expect significant synergies in various areas. Lux Group Holdings has a multi-unit and contracts initiative that has an international focus specifically in increasing efficiencies in the development sector.
Q: Can you give any reassurance to employees, retail stockists and customers that there would be a continuity of business?
A: We expect the brand will thrive and all stakeholders will be happy with the results.
Q: What are your short-, medium- and long-term predictions for the market given the impact of the coronavirus lockdown?
A: Our view is absolutely and resolutely long term – and we only focus on long term trends. Sudden storms and black swan events are merely blips on a chart and do not impact the decision-making process.
Q: Will you continue on the acquisition trail? Are there any areas that you are looking to move into?
A: We expect to continue our quest for ‘Best of Class’ luxury assets.
Q: Will you stay in the luxury premium end of the market or would you look to expand into the mid-market?
A: Our focus is Luxury Premium – and luxurious mid markets that are also ‘Best of Class’
Q: Will you stay in furniture or would you acquire a complementary business? E.g appliances, brassware, worktops.
A: We would consider well run businesses that are once again “Best in Class”
Q: Would you ever move into bathrooms?
A: We currently participate in the bathroom arena as part of our whole house offerings and see this as an area of growth within Lux Group.