n a notable exchange of assets that helps each company focus on its core business, SCP Pool Corp. is set to acquire the distribution assets of Latham International LP’s Canadian subsidiary, Pool Tech Distribution Inc. In return, Latham will acquire the manufacturing assets of two SCP subsidiaries, Fort Wayne Pools Inc. in Fort Wayne, Ind., and Les Industries R.P. Inc. in Terrebone, Quebec, Canada.
“We’re very pleased with the transaction,” said Mark Laven, president/CEO of the Latham, N.Y.-based manufacturer. “I think it furthers our ability to achieve our objectives and helps us grow the business.”
In conjunction with this agreement, SCP also will receive a minority interest in Latham Acquisition Corp., a group of investors who will purchase Latham International from its current shareholders. As a result, new Latham stockholders will include SCP; Brockway Moran & Partners Fund LP, a private equity firm; and current Latham executives.
For the pool and spa industry, the acquisitions and divestitures signal SCP’s departure from the manufacturing sector. While the company will still hold a stake in Latham’s operations, it will no longer oversee any manufacturing facilities of its own.
“Latham wants to focus on its manufacturing business and, by virtue of disengaging from distribution, they are able to do that,” said Manuel J. Perez de la Mesa, president/CEO of Covington, La.-based SCP. “We, on the other hand, want to focus on distribution, and now we can do that. This transaction will make us a better distributor.”
The decision also helps SCP add value to its bottom line. “Incrementally, we expect to realize … approximately $10 million in incremental net sales, as a result of these transactions,” Perez de la Mesa added.
SCP’s new Canadian distributor, Pool Tech, operates three service centers in Ontario and is expected to have 2004 net sales that exceed $20 million.
The transactions are expected to close by Dec. 31. All the companies and subsidiaries involved will retain their present brand names, facilities and employees. No additional changes are expected.
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