I was at my local mower dealer today and was told about an imminent buyout of Exmark. Seems he was under the impression Husqvarna was buying exmark. Anyone else hear this?
I would think if that took place JD would be the only one with pockets that deep. JD can buy anything they want and will if someone sells.At least its a long shot. Sounds like it is broader than Exmark. I hope not. Might be John Deere time then.
That is very interesting to think Husqvarna is that strong, this day and time you hardly know who owns what and if you do that can change tomorrow.Envy: (a few observations from my outpost on Baltic Avenue ):laugh:
Husqvarna could buy damn near anything they choose.
g
they say that everytime you learn something you brain gets a new wrinkle. i bet envys is worse than any dried up prune.:hammerhead:Well, I'm privy to a little information I can share...
It's my understanding that Husqvarna was set to 'go public' somewhere along the middle of last year... as in becoming publicly traded in a fashion separate from Electrolux, which was the point of the spin-off.
At that time they had revenues of over 4 billion just from the husqvarna group. Going public has of course made them more financially fluid. On top of it, they issued 30-some million new shares to "fund" purchases.
Toro as a whole was a target purchase, and I can see why... given the orange strategy, but a deal that would be hard to 'work' I think. Something that could happen, but not something I would bet on.
The possiblility of purchasing the eXmark division I believe would be a lot easier to work. But given the orange strategy, it makes less sense.
So I guess in a nutshell, what I am trying to say is that they could afford to purchase Toro if they could work the deal.... and the whole Toro company purchase would more effectively 'fit' their apparent strategy. On the other hand, they could certainly afford to buy eXmark, and the details would be a lot easier to work out... likely with a nice contract to continue producing Zmasters for Toro, but it doesn't 'fit' their apparent strategy as well.
But considering the RedMax purchase, if Husqvarna buys eXmark or another top producer, it would not surprise me much.
Gary,Envy: (a few observations from my outpost on Baltic Avenue ):laugh:
It seems to me, the real story to consider in a possible Husqvarna acquisition of Toro has little to do with commercial products but is instead about the effect on the overall consumer market.
Being (in relative terms) a pretty small and obscure brand, it would make little sense for HOP to buy the Exmark division alone. They can just wear em out in the marketplace if they choose to. :hammerhead:
But, with over 80% of all outdoor power equipment sold through box-stores, it makes complete sense for HOP to buy Toro as a group. This purchase would give them not only the Toro and Exmark brands, but Lawnboy and Wheel Horse as well. Combined with their current products and brands, this total package, could utterly dominate (by a wide margin) the mass-merchant market. A combined HOP/Toro would also have such massive purchasing power that major suppliers (engines and drive systems) would become virtually captive. MTD would become even less relevant and Deere would find themselves suddenly chained up in the pasture as a one-trick pony. Game-over. (If this does happen, Id start watching for Deere to make a run at MTD. They cant continue to grow playing at only the high-end. Deere C&CP Group also has a number of ex-MTD guys who I imagine would love to spank the teacher!)
Toros currently trading at ~$54-55 (historical level closer to $45) with <40M shares outstanding. Their balance sheet is OK, but it aint a power-house. I would also imagine that a lot of those shares are held by Institutional buyers who probably wouldnt mind to swap for a faster growing stock. With $1.5B in hard-cash on hand and basically unlimited resources for additional funding, Husqvarna could buy damn near anything they choose. Toro would be a very smart play if they can get it passed the anti-trust guys. I would think that this would very nearly satisfy the definition of a monopoly.
Hotels on Board Walk and Park Place wins the game every time.
g
That has been what John Deere has been doing for almost a century !If you can't build them buy them.:laugh: