“Black Diamond’s acquisition of PIEPS reflects our ongoing strategy to assemble the best and brightest global companies that lead the charge in creating safer travel and backcountry adventure experiences,” said Peter Metcalf, president and CEO of Black Diamond. “Like Black Diamond Equipment, PIEPS is widely recognized among backcountry enthusiasts for its electronic innovation, premium quality, product reliability and practicality. This reputation has translated into their position as one of the global leaders in avalanche transceivers and has given PIEPS a leading market share in its core markets of Germany and Austria.
Founded in 2006, with roots dating back to 1972, PIEPS is widely recognized as an innovator and technology leader in alpine safety equipment. PIEPS offers a focused range of premium alpine performance products, including avalanche transceivers and probes, shovels, safety equipment, packs, and satellite-based devices for messaging, route tracking, and navigation. PIEPS is the only authorized European Iridium satellite network partner within the alpine sport and outdoor sectors.
PIEPS’ CEO Michael Schober commented: “The joint power of Black Diamond’s global operational resources and PIEPS’ leading alpine search and rescue technology creates a powerful platform for further product development. We believe that Black Diamond’s existing and planned electronic products will be supported with our extensive technical experience developing and manufacturing avalanche beacons and other electronic devices. In Black Diamond, we are confident that we have found our ideal match to cultivate our brand and look forward to continue delivering premium alpine performance products.”
For its fiscal year ended March 31, 2012, PIEPS’ sales were €6.0 million or approximately $8.2 million.
Under the terms of a definitive agreement, Black Diamond will purchase PIEPS for €8.0 million or approximately $10.4 million in cash and will also assume approximately €2.1 million or $2.7 million in debt. Black Diamond has committed up to an additional estimated €2.3 million or approximately $3.0 million of contingent purchase price upon PIEPS’ achievement of certain sales targets between the closing of the transaction and March 31, 2015.
The transaction is expected to close on October 1, 2012 and is expected to be immediately accretive to Black Diamond earnings per share.
“PIEPS will be run as a semi-autonomous, discrete but closely linked Black Diamond brand that we believe will benefit directly from our operational infrastructure that is similarly tailored to highly engineered, life-dependent products,” continued Metcalf. “We also expect to grow PIEPS’ sales in those markets and geographies covered by Black Diamond’s global distribution platform. PIEPS has historically generated higher gross margin than a typical hard goods company and we expect that to have a positive impact on our overall average gross margin. PIEPS intellectual property, specifically its avalanche technology—including their paradigm-changing Global Finder—supports Black Diamond’s continuing focus on developing our electronic technology and applications product portfolio. We believe that all of these factors make PIEPS an ideal acquisition for Black Diamond as we advance our strategy to become the world’s most respected outdoor equipment and lifestyle company.”
Black Diamond Europe Managing Director, Christian Jaeggi observed, “In Europe the combination of Black Diamond with its highly respected, responsive, and centralized dealer services operation with the avalanche safety and transceiver leadership embodied in Pieps creates a truly synergistic opportunity that we believe will benefit not only both companies but retailers and consumers alike.”
All PIEPS products are designed and developed in its state-of-the-art facilities and are the result of close collaboration with top mountain guides and rescue teams, scientists and alpine security specialists, as well as major universities in Austria and Switzerland, such as the Institute for Snow and Avalanche Research. PIEPS electronic products will continue to be manufactured by SEIDEL Elektronik, another member of the SEIDEL Group and a contract manufacturer of electronic products for over 15 years.
Renowned for its technological innovation, PIEPS is the recipient of many prestigious industry awards, including Gear of the Show at the summer 2012 Outdoor Retailer and the ISPO Outdoor Award in 2011. It also holds the distinctive ISO (International Organization for Standardization) 9001 certification which defines the standard for quality management systems.