Hornby have taken control of the French distribution company for model railway and Jouef products throughout France. At the same time Hornby have created a new company, Hornby France, which will take responsibility for the distribution of the Jouef and Scalextric brands in........yes you have guessed it, France!
This announcement is from Hornby:-
QUOTE HORNBY ACQUIRES FRENCH DISTRIBUTION COMPANY
Hornby Plc ("Hornby"), the models and collectibles group, has announced that it has acquired the assets and ongoing business of its distributor in France. MKD, a family owned company, is based outside Paris and is a well-known distributor of model railway products and Scalextric throughout France. Founded in 1981, MKD reported sales in 2004 of Euro3.8 million, producing earnings before interest and tax of Euro226,000.
Under the terms of the Sale and Purchase Agreement Hornby acquires the "Fonds de Commerce" of MKD. Under this arrangement, frequently used in France, Hornby acquires the fixed and intangible assets and retains existing employees of which there are 11. Hornby does not assume responsibility for any of MKD's liabilities. The consideration for the Fonds de Commerce is Euro750,000. The inventory of MKD is subject to a separate valuation and purchase agreement for an amount of approximately Euro750,000, subject to audit.
Frank Martin, Chief Executive of Hornby commented,
" The acquisition of the assets of MKD and the establishment of Hornby France is a further vital strategic step in establishing a pan-European model railway and slot racing business.
" MKD has been the Scalextric distributor in France since 1996 and the founders of the business, Olivier and Martine Lanter have many years of experience in the French model railway market. Both previously worked for Jouef in the 1980's.
" The Jouef brand, which we acquired with the Lima assets, enjoys a similar level of awareness and affection amongst consumers in France as Hornby does in the UK. In order to maximise the benefit from our plans to re-invigorate the Jouef product line, following the relocation of the manufacturing activity to China, it was important for us to control the distribution of Jouef in France. Direct control of our distribution of Scalextric in France will also enable us to attack the market more aggressively in the same way as we have in Spain this year through Electrotren. " We expect to be able to increase significantly the sales and profits in MKD (Hornby France) as substantially higher sales volumes will be channelled through the existing, fixed cost base."