Citing a “comprehensive strategic review of its business” conducted since the completion of the Newell Rubbermaid and Jarden combination, Newell Brands announced plans to sell off 10 percent of its portfolio including the vast majority of Winter Sports businesses within the Outdoor Solutions Segment. That means some of the most iconic and familiar winter sports brands such as K2 Sports, Volkl, Marker, Ride snowboards, Line and Full Tilt are effectively up for grabs.
Newell said it is looking to simplify its operating structures by consolidating the existing 32 Business Units to 16 Operating Divisions, including the creation of a new global enterprise-wide e-Commerce Division. The proceeds from brand sold will be used primarily to accelerate debt pay down, and creating a platform for future acquisitions more connected to the company’s core businesses. Brands for sale also includes the vast majority of Newell’s current Tools Segment, Heaters, Humidifiers and Fans businesses within the Consumer Solutions Segment, and the Consumer Storage Container business (Rubbermaid) within the Home Solutions Segment. The total 2015 net sales of the businesses held for sale are approximately $1.5 billion.
“The combination of Newell Rubbermaid and Jarden has created a unique platform for transformative value creation and the actions we are taking to reshape the company will unlock this opportunity, bringing greater investment and growth to our highest potential categories like Writing, Home Fragrance, Baby, Food Storage & Preparation, Appliances & Cookware, and Outdoor & Recreation. The choices we are making will strengthen the underlying growth and performance of our most strategic businesses and over time enable us to scale our core categories through external development,” said Mark Tarchetti, Newell Brands President.
Newell in April completed its acquisition of Jarden Corp., which had acquired K2 Sports and its Marker, Marmot, Rawlings, Sevylor and Volkl brands in 2007. Shortly after that deal, Newell Brands chief executive Michael Polk announced plans to reshuffle the company’s brand stable and shed “under-performing” brands. In September he told investors that he planned to “rapidly exit” companies he could not sell, suggesting a Jan. 1 deadline for sell of shutter decisions.
“Ideally I would like to sell these assets versus simply walk away from them,” he said at the Barclay’s Consumer Staples Conference in Atlanta. “Some of them are the kinds of businesses that would be difficult to sell and therefore, we should just shut down because they create no value for you and they are a distraction for us.”
In other words, that could means there is only three or so months left to find buyers for the likes of K2 Sports, one of the most recognized brands in the snowsports market. In addition to K2 Skis and K2 Snowboarding, the K2 Sports stable includes snowshoe makers Atlas, PowderRidge, Tubbs and Little Bear; snowboarding brands Morrow and 5150; running shoe maker Zoot; and cross-country ski company Madshus.
“The sale processes are underway and the company hopes to complete the divestiture of the assets held for sale within the first half of 2017,” said the company.