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Kaman acquires MBT Holding corp.

Kaman Corporation (NASDAQ:KAMNA) has paid approximately $30 million, subject to a post-closing working capital adjustment, to acquire the majority of the assets and assume certain of the liabilities of MBT Holding Corp. and its subsidiaries, more commonly known as Musicorp, a wholesale distributor of musical instruments and accessories headquartered in Charleston, South Carolina. The acquisition is expected to be accretive to Kaman earnings in 2005.
Kaman is the industry's largest independent distributor of musical instruments and accessories with warehouses in Bloomfield, Connecticut; Portland, Tennessee; and Ontario, California. In addition to distributing general musical products, Kaman's Music segment, with sales of $79.4 million for the first half of 2005, owns or exclusively represents many world-renowned brand names such as Ovation guitars, Takamine guitars, Gretsch drums, Gibraltar drum hardware and Latin Percussion hand drums.
MBT is the second largest U.S. distributor of musical instruments and accessories after Kaman with sales of approximately $30 million for the first half of 2005, and with warehouses in Charleston, South Carolina; Louisville, Kentucky; Dallas, Texas; Reno, Nevada; and Rockville, Maryland. Prior to 2003, MBT is best known to most U.S. customers for its reliable and user-friendly distribution operations functioning under the Musicorp name. In 2003, MBT acquired two smaller wholesale distribution companies, Midco International of Effingham, Illinois, and M&A Sales of Rockville, Maryland. MBT will operate as a separate unit within Kaman's Music segment.
Paul Kuhn, chairman, president and CEO of Kaman Corporation, said, "This acquisition will put Kaman in a much stronger position to take advantage of logistical, technological and operational efficiencies that are demanded in this highly competitive market. Our goal is to become an even closer partner with our customers, expand the market for our proprietary brands, form new alliances and strengthen current relationships with manufacturers and product suppliers."
Bob Saunders, president of Kaman Music, said, "The product offering and the in-market delivery systems of our two companies, while being somewhat different, are actually quite complementary. We anticipate that our customers will find this acquisition fairly transparent and dealers will continue to be called on by both the Kaman and the MBT sales teams. Additionally, this acquisition will afford Kaman Music the opportunity to expand our proprietary product offerings beyond what we are currently able to achieve with one sales team alone."
Dan Mahoney, president of MBT, added, "The marriage of Kaman Music and MBT is a natural one. With so much consolidation going on in the music business today, it is logical that our combined companies will be better able to serve our customers' needs than two individual companies standing alone. The combined warehouse space of the two companies exceeds 600,000 square feet. Kaman has a tremendous IT department that will help electronically link all our customers directly into our inventories. Our sales team is eager to continue to grow MBT on its already firm foundation."
08/2005 Pro-Music-News
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