Husqvarna Signs Intent to buy RedMax

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Husqvarna AB: Husqvarna Signs Agreement to Acquire Outdoor Power Products Operation from Komatsu of Japan
STOCKHOLM, Sweden — Husqvarna has signed a Letter of Intent with Komatsu Ltd. regarding acquisition of the outdoor power products operation within Komatsu Zenoah Co. ("Komatsu Zenoah").

Komatsu Zenoah is a leading producer of portable outdoor power products and is the market leader in Japan. The outdoor-product range comprises mainly brush cutters, chainsaws, trimmers and blowers. Sales for this operation in 2005/2006, the latest fiscal year, amounted to approximately JPY 19 billion (approximately USD 170m), of which about half in Japan. The number of employees was approximately 700. Production is based in Japan and China.

The acquisition will strengthen Husqvarna’s position in the global market for professional forestry equipment as well as portable lawn and garden equipment, and will also strengthen the Group’s presence in Asia.

A final agreement is expected to be signed before year-end, subject to due diligence and approval by the relevant authorities. The acquisition is expected to be completed by the first quarter of 2007. The operation will be integrated in the Group’s Professional Products business area.

"Komatsu Zenoah has a strong product offering and extensive expertise in two-stroke engines. This provides a good fit with Husqvarna’s operations, and we see substantial opportunities for achieving synergies in several areas. The acquisition will also strengthen our position in Asia in terms of both market presence and production", says Bengt Andersson, President and CEO of Husqvarna.

Husqvarna is the world's largest producer of chainsaws, lawn mowers and other portable petrol-powered garden equipment such as trimmers and blowers. The Group is also a world leader in diamond tools and cutting equipment for the construction and stone industries. Net sales in 2005 were SEK 28.8 billion and the average number of employees was 11,700.

I got the same E-mail from Husky this morning, as did a few other guys I've spoken to. So, this is fact and not a rumour.

Orange EBZ-8000's are on the way!

With this purchase Husky will become the world leader in emmissions compliant 2 cycle OPE.

Hey Thall

Hey Thall.....wink.

bwalker said:

With this purchase Husky will become the world leader in emmissions compliant 2 cycle OPE.

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You are right Ben, this is actually a pretty smart move by Husky.

I wonder what this means for Red Max as a brand. These events are usually followed by announcments that nothing much will change for the acquired brand, at least in the short term, to ease everyones concern. But even if they keep Red Max as a brand, it will never the less be weakened if all of their best stuff is available in Husky orange.

I guess if you already have both brands, there is nothing to worry about.

It's a good move... No doubt it will save a lot of re-engineering (time to market) to comply with the EPA noose. And Husky sure needed a better blower line if nothing else!

I'd love to be the fly on the wall in their Japanese/Swedish /USA engineering and product meetings! I worked in Japan for two years and ran the International Engineering for a big Japanese corporation for 7... Can't say it's all fun getting a mind-meld... Assuming they are both profitable, the best thing they could do is leave the brand identities alone for a long time...

I suspect it's also to do with bolstering the balance sheet so the institutional shareholders can realize some of their equity down the line.

The bigger Husky gets the better Stihl will have to be. Now all they need is dealers opcorn:

Lakeside53 said:

It's a good move... No doubt it will save a lot of re-engineering (time to market) to comply with the EPA noose. And Husky sure needed a better blower line if nothing else!

I suspect it's also to do with bolstering the balance sheet so the institutional shareholders can realize some of their equity down the line.

The bigger Husky gets the better Stihl will have to be. Now all they need is dealers opcorn:

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Problem I see to be a Husky Dealer you have to take on there whole line.
Like the lawnmowers.

manual said:

Hey Thall.....wink.

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Tom's aready considering the improving employment picture:hmm3grin2orange:

manual said:

Problem I see to be a Husky Dealer you have to take on there whole line.
Like the lawnmowers.

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They can change that in the stroke of a pen...

Lakeside53 said:

Tom's aready considering the improving employment picture:hmm3grin2orange:

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Yea I'm sure his mind is wondering some where.:monkey:

Lakeside53 said:

They can change that in the stroke of a pen...

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What do you mean?

manual said:

What do you mean?

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Let me guess now... For example (and I haven't seen a Husky dealer agreement) they could change "must carry" entire line to "best efforts".

Right now Husky must believe that it's in their interests to force their dealers (if they do) to carry the entire line. If they decide it's not, they will "amend" the dealer contract...

If Husky is smart they will keep the Redmax brand identity intact while expanding dealer coverage for Redmax thgrough their network. Husky's blowers and trimmers do not have a stellar reputation and as such it makes no sense to produce orange Redmax's.
I suspect Husly made this purchas based on the fact that Redmax has many patents on compliant two cycle engine technology tied up. They really have no equal in this regard.
Its going to interesting to see the next Husky design compliant saw. I suspecct it will be a much better effort than the 575.
If Husky is serious Stihl better get their **** together.

In order to be a "Total Source" dealer and have your name on the net, then you must sell the entire line. That means generators also. I made a post of what you had to carry before.

Its just upsetting to sell $50k - $75 a year and have them take you off the net because you dont sell 4 tractors or 2 generators a year.

stckciv said:

In order to be a "Total Source" dealer and have your name on the net, then you must sell the entire line. That means generators also. I made a post of what you had to carry before.

Its just upsetting to sell $50k - $75 a year and have them take you off the net because you dont sell 4 tractors or 2 generators a year.

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So you don't have to be a "Total Source" dealer ?

No you do not have to be.

This is what you need to buy to be a "Total Source" dealer:
Product Minimum Requirements: (Invoiced Shipments/No Back Orders)

25 Saws/ Cut Off Saws
20 Blowers/ Trimmers/ Pole Saws/ Bruschcutters/ Mini-Cultivators/ Edgers/ CT20 Tiller/ Nova Cut
10 Walks/ Snow Blowers/ Tillers/ HVT Trimmer/ LE 389
6 Tractors/ ZTR/ Specialty Turf/ HUV/ CZ/ EZ
2 Pressure Washers/ Generators


And this is what they offer if you buy everything:
FREE Direct Mail, Dealer Tagged Mini Catalogs (Spring & Fall 2007)
FREE TV Spots*
FREE Retail Financing Promotions (No cost to dealer)
FREE Spring and Fall Deluxe P.O.P. Kits
FREE listing on Husqvarna.com and 1-800-HUSKY 62


Thing is they used to offer P.O.P. kits, put you on the net, financing promotions to everyone. They used to support the dealer and help you sell their product, now you have to buy the crappy mowers to get a simple listng on the net.

manual said:

Hey Thall.....wink.

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Wink back at ya. Now Manual you got to build another stall in the barn, another zebra on the way, LOL. All kididng aside sounds like Husky is on the move, good for them. Lets hope they don't force the Redmax dealers to sell everything else they have and mess it up. Thats been a big issue with them. Two long time Husky dealers around here booted them out the door when they came in and said you have to sell th entire line up. They found out different, those two dealers are both selling guess what now, yup, Stihl.

Here in Texas they have a very small dealer network and it is mostly people set up to take care of Tractor Supply and Lowe's box stores. They will also sell directly to the commercial people if they get the chance. No such thing as dealer loyalty with this bunch. The aquisition was to help them stay compliant and they will end up ruining Red Max as they have done to their own brand.

Just Mow said:

Here in Texas they have a very small dealer network and it is mostly people set up to take care of Tractor Supply and Lowe's box stores. They will also sell directly to the commercial people if they get the chance. No such thing as dealer loyalty with this bunch. The aquisition was to help them stay compliant and they will end up ruining Red Max as they have done to their own brand.

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You post on lawnsite as well dont you?

I dont see how they have ruined their own brand, their saws are still very good quality, hedge trimmers and trimmers are nice as well. I should say some of their trimmers, not all.

stckciv said:

You post on lawnsite as well dont you?

I dont see how they have ruined their own brand, their saws are still very good quality, hedge trimmers and trimmers are nice as well. I should say some of their trimmers, not all.

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Yes I do.
And the units that Husky make are of good quality, I am talking about the Poulan units.