Jacuzzi Group Worldwide announced the acquisition of ThermoSpas nearly a month ago, yet both hot tub manufacturers remain tightlipped about the deal.
In the only public announcement on May 31, Bob Rowan, president of Jacuzzi North America, cited ThermoSpas’ unique direct-to-consumer sales approach and lead generation as primary reasons for the purchase.
“ThermoSpas’ ability to generate interest in the hot tub category combined with a cutting-edge system of managing leads will prove to be a significant benefit to ... our corporation,” he said.
More information regarding the purchase is scarce, though Rowan did indicate that Andy Tournas will continue as president of ThermoSpas, the Wallingford, Conn.-based company he founded in 1983. However, the two firms will remain distinct, a fact that has fueled concern among some Jacuzzi and Sundance Spas dealers.
“They tried to tell us that [ThermoSpas] isn’t going to compete with us, but every brand out there does,” said Tom Gervais, owner of New Mexico Leisure in Albuquerque.
Though not unprecedented, an acquisition of one spa maker by another is a relatively rare occurrence. In 2009, MAAX Spas purchased DM Industries and its Vita Spa brand. And late last year Watkins Manufacturing, which bought Caldera Spas in 1999, added American Hydrotherapy Systems’ rotationally molded Freeflow Spa line to its fold.
With little details to go on, Gervais and others are questioning the logic behind the move, pointing to ThermoSpas’ recent decline in sales and alleging a large gap between the number of leads and actual spas sold.
“The goal is to sell a spa, not just generate leads. I’d be curious to know how much it cost them. It doesn’t make sense to start another brand when you already have two that are taking all of your resources,” Gervais said.
Others don’t see the purchase as having a negative effect and speculate that Jacuzzi’s decision to buy the firm was influenced by ThermoSpas’ filing for Chapter 11 bankruptcy protection in February.
“It’s likely something they bought at a fire sale, and they’ll use what they can and discard what they don’t need,” says Tom Healy, owner of California Cooperage of Santa Monica, and a dealer of Jacuzzi spas. “You never know what the truth is until they tell you.”
Meanwhile, the industry awaits news on how Jacuzzi will integrate the consumer-direct sales program that Tournas implemented for ThermoSpas in 1995. ThermoSpas originally had a dealer base, but quickly turned to attracting buyers by way of infomercials, making it one of only a few to also boast a national advertising campaign.
“Their business models are so different, and that’s why there is some curiosity about how this is all going to roll out,” said Bob Lauter, CEO of Master Spas in Fort Wayne, Ind. “People are really curious to see how the two business models merge.”
ThermoSpas’ campaign helped to keep hot tub ownership in the spotlight, and the idea of losing such powerful consumer outreach was disappointing to Lauter and others.
“That was one of the biggest blows when ThermoSpas went bankrupt, so it helps having a national player buy them,” he added.
Founded in 1925, Chino Hills, Calif.-based Jacuzzi began as a pump manufacturer and today produces hot tubs, bathtubs, walk-in bathtubs, showers and sinks.