MARTINSVILLE, Va. -- Hooker Furnishings has acquired Sunset West, a West Coast-based manufacturer of outdoor furniture, in an all-cash transaction.

Announced Feb. 1, Hooker Furnishings said the deal will enable it to immediately gain market share in the growing outdoor furniture segment of the industry. Under terms of the deal, Sunset West’s management team and all the company’s employees will continue to serve customers from its headquarters in Vista, California.

According to Hooker's Jan. 31 SEC filing, the company acquired substantially all of the assets of Sunset West in exchange for $23.5 million in cash at closing, an additional $2 million subject to an escrow arrangement and possible earn-out payments to the Sunset West members up to an aggregate of $4 million with the closing cash consideration subject to adjustment for customary working capital estimates. Under the asset purchase agreement, Hooker Furnishings also assumed specified liabilities of Sunset West.

“As consumer lifestyle trends have shifted to spending more time outdoors, they want the same quality and design they have inside of their homes. The Sunset West brand and its people bring so much to the table by becoming part of the Hooker Furnishings family of brands. They are experts in the category who understand the market, the value proposition and product sourcing, giving us immediate credibility in the segment that it would have taken years to build ourselves,” said Hooker Furnishings CEO Jeremy Hoff.

According to Sunset West founder and CEO Wes Stewart, the transaction provides his company with warehousing and stronger distribution in the eastern and central regions of the country, access to Hooker Furnishings high-traffic showroom in High Point, and the opportunity to sell into its large retail and interior design customer base.   

“Partnering with a legendary name in the industry like Hooker Furnishings was paramount to our strategy. The convergence of outdoor and indoor furniture gives us both stronger product offerings and opportunities. The price points and channels of both our companies align extremely well,” said Stewart.

Based in Martinsville, Virginia, Hooker Furnishings (NASDAQ: HOFT) is ranked 23 on the 2022 FDMC 300 list of the largest North American wood products producers and is among the nation's largest publicly traded furniture sources. The corporation has 12 operating businesses, with brands that include: Hooker Furniture, Hooker Upholstery, Bradington-Young, Sam Moore Furniture, Shenandoah Furniture, H Contract, Accentrics Home, Pulaski Furniture, Samuel Lawrence Furniture, Prime Resource International, Samuel Lawrence Hospitality and HMIdea. Corporate offices and upholstery manufacturing facilities are located in Virginia and North Carolina, and the company has showrooms in High Point, North Carolina, Las Vegas and Ho Chi Minh City, Vietnam. Hooker Furnishings also operates distribution centers in the United States, China, and Vietnam.

Stump and Company initiated the transaction and were advisers to Sunset West. Hooker Furnishings was represented by McGuire Woods.