By Claire Reilly
De’Longhi has obtained perpetual licensing rights of the Braun name for use in small kitchen appliances, ironing and selected household appliances, following an agreement with the Proctor & Gamble Company, which owns the Braun brand.
"We are particularly proud to have reached an agreement with P&G in relation to the licensing of the Household Small Appliances business of Braun," said Fabio De’Longhi, CEO of De’Longhi. “This prestigious brand will allow us to enhance our equity story in the highâ€end segment of the small domestic appliances market, characterized by a high degree of quality, innovation and design.”
Aside from the right to use the Braun name and connected patents, De’Longhi confirmed that “the transaction includes the acquisition of certain production assets and the inventory" that are related to the aforementioned product categories.
In addition, the company anticipated that "certain P&G employees, predominantly located in Germany, will become De’Longhi employees upon the closing of the deal. Ownership of the Braun brand will remain with P&G.”
Although the agreement is subject to the approval of relevant authorities, the financial details of the purchase have been confirmed.
“The purchase price (excluding inventory) is split into three components: 50 million Euro to be paid at completion, 90 million Euro (at present value), deferred in equal annual payments over a fifteen year period, and a variable amount (ranging from 0 to 74 million Euro, at present value) linked to sales performance of the acquired business over a five year period from completion.”
Speaking about the agreement with De’Longhi, the vice chairman of the Proctor & Gamble Company, Dimitri Panayotopoulos, said it was “an excellent transaction for Braun and Procter & Gamble.
“De’ Longhi has a strong track record in developing premium Household Small Appliances and is the perfect partner to accelerate growth of the Braun equity in these key categories,” he said. “This will allow us to focus our inâ€house capabilities against driving and expanding our presence in the rapidly developing Beauty & Grooming appliance space.”
According to a De’Longhi spokesperson, the Braun business that is associated with the agreement “has revenues of approximately 200 million Euro, mainly concentrated in European markets”.