Yankee Candle sold
New parent company owns many other household brands
SOUTH DEERFIELD — Yankee Candle Co. is being sold to a Fortune 500 company that also makes Mr. Coffee, Ball canning jars, Tubbs snowshoes and Coleman camping products.
Current owners of the 43-year-old Franklin County candle-making giant announced Monday that they had entered into a “definitive purchase agreement” with Jarden Corp. of Rye, N.Y., for $1.75 billion in cash.
The sale by Madison Dearborn Partners LLC, a private-equity firm that had held the candle maker for six years, will provide the company with a “long-term and very stable home,” said Yankee President and Chief Executive Officer Harlan Kent.
Madison Dearborn, which paid $1.6 billion to the private equity firm Forstmann Little in 2006 for the home-grown candle company — Franklin County’s largest employer — had put Yankee Candle up for sale earlier this year, seeking at least $2 billion, according to Reuters, which also reported that if the Chicago-based owner did not find a buyer, it had planned to float the Deerfield-based company on the open market. Terms of the sale also include up to $55 million in additional “earn-out” payments based upon achievement of certain performance targets, according to information provided by the company.
Yankee Candle employs 1,600 in the Franklin County area at its Whately factory, and South Deerfield distribution center, offices and flagship store. In addition, the company, which describes itself as the largest-selling designer, manufacturer, wholesaler and retailer of premium scented candles, has 561 stores in 46 states and one Canadian province. Its European-based international subsidiary also sells candles in 57 countries.
Whereas Madison Dearborn, whose other properties include Boise Cascade, LA Fitness and T-Mobile USA, is focused on investing in businesses and then selling them off, as it had been trying to do with Yankee Candle, Kent said Jarden keeps the businesses it has bought and now has more than 120 brands including Sunbeam and Crock-Pot appliances, Rawlings baseball gear, Bicycle playing cards and First Alert products.
“We see this as a long term and very stable home for Yankee Candle,” Kent said. “You have two very well-positioned, growing companies that are coming together, and that’s going to provide some very exciting opportunities for us in the long run.”
The sale is expected to become final before year’s end.
Specifically, Kent pointed to four areas, including Jarden’s business expertise and technologies such as appliances that could have application in Yankee Candle’s home-fragrance products. Whereas less than 15 percent of Yankee Candle’s business is from international sales, that segment accounts for more than 30 percent of Jarden sales, leading Kent to point to its new owners’ international marketing teams as helping with Yankee Candle growth globally.
Kent also sees a potential for cross-marketing with Jarden’s other consumer products, as well as the possibility of cost savings for the company through shared purchase of raw materials.
“We have had a significant commitment to the Pioneer Valley and western Mass.,” said Kent. “We’re very proud of being from here, and it is our home. This is a very exciting, new chapter for the company, that is absolutely not going to change. We certainly don’t see significant changes as to manufacturing here, having our headquarters here or any of that going forward. ...We think this is a great outcome for our shareholders and an absolutely great outcome for Yankee Candle employees and customers.”
He said Yankee Candle plans to continue to open new stores, grow its consumer-direct and wholesale businesses and continue to draw on its “brand strength, unparalleled reputation for quality and ‘Made in America’ heritage.”
Yankee Candle had $863 million in sales in the year that ended June 30, sales that grew 7 percent in 2012 and are on target for similar growth this year, said Kent.
Madison Dearborn has been supportive to the candle-maker over the past six years, investing in the business during the economic downturn, when it continued to grow, Kent said, and investing $30 million in the company over the past three years to further growth that has been at a compounded annual rate of 7 to 8 percent.
Jarden, whose name comes from the company’s core product, the Ball canning jar, was built on traditional brands “with a lot of history and heritage … that are used in and around your home,” according to founder and Executive Chairman Martin E. Franklin.
“We are delighted to announce this acquisition, which is consistent with our more than 10-year track record of success in acquiring leading consumer brands synonymous with their niche categories,” Franklin said. “The iconic Yankee Candle brand is a natural extension of our existing portfolio .... As a successful, well-managed and well-invested business, Yankee Candle is a solid platform for us to leverage our proven, time-tested and portable brand-building approach and to drive additional value through investments in brand equity, product development and innovation.”
James E. Lillie, chief executive officer of the 12-year-old company, added, “Our complementary strengths and skill sets pave the way for new cross-selling opportunities, cross-brand collaboration, partnerships and cross-business support, accelerating revenue growth across our global platform and driving long-term shareholder value. Jarden’s global presence, capabilities and scale will facilitate Yankee Candle’s expansion into new markets and geographies to further drive top-line growth and profitability.”
This is Jarden’s first significant acquisition since April 2010, and its largest acquisition to date.
Franklin County Chamber of Commerce President Ann Hamilton said she said she saw no significant change coming from the planned acquisition, referring to it as “basically a high-finance thing.”
Yankee Candle was started by Michael Kittredge at age 17 when he melted candles to make a Christmas present for his mother. A South Hadley neighbor saw the candle and asked him to make one for her as well. Four years later, his business had outgrown the family’s garage, and he set up a factory in Holyoke, moving to Deerfield in 1983. Today Yankee candle produces candles and home fragrance products in more than 150 fragrances, from bacon to “green bamboo.”
Kittredge eventually sold the company, and in more recent years has backed his son’s creation of a competing Kringle Candle Co. in Bernardston.
On the Web: www.jarden.com/about
You can reach Richie Davis at
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