MARTINSVILLE, Va. - Hooker Furniture Corp. has officially moved into the top five residential furniture producers with its acquisition of Home Meridian International. Announcement that the $100 million purchase was finalized was made Feb. 2.

Already a top-tier supplier of upholstered furniture and casegoods, Hooker Furniture (NASDAQ:HOFT) said the acquisition more than doubles its sales volume. Revenues for the combined companies over the trailing 12 months, ending October 31, 2015, were in excess of $550 million.  During the same time period, operating income for the combined companies, which includes approximately $3.5 million of deal-related costs, was $35.6 million. Hooker Furniture was #35 and Home Meridian #37 in the latest FDMC 300 rankings of top wood products manufacturers and importers in North America.

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January's definitive agreement includes $85 million in cash and $15 million of newly-issued HOFT stock. The transaction also included a customary net working capital adjustment leading to a $5.3 million upward adjustment. A statement from Hooker said the adjustment was driven by an increase in HMI's accounts receivable primarily due to strong sales end of 2015, and was paid in newly issued HOFT stock;  and therefore Hooker issued a total of 716,910 shares in the transaction.

"We are greatly pleased to have the individual companies that comprise Home Meridian become part of our Hooker Furniture stable of companies," said Paul B. Toms Jr., Hooker chairman and CEO. "Pulaski Furniture, Samuel Lawrence Furniture, Prime Resources, Sourcing Solutions Group, Right 2 Home and Samuel Lawrence Hospitality are all vibrant businesses addressing more moderate points and channels of distribution not currently served by Hooker Furniture, Sam Moore, Bradington-Young, Homeware and/or H Contract," he said.

Operating as a division of Hooker Furniture Corp., HMI will continue to be led by former President and CEO George Revington and his management team. HMI's headquarters will remain in High Point, North Carolina. Hooker Furniture is headquartered in Martinsville, Virginia.

The combined global footprint of the companies will include upholstery manufacturing facilities in Hickory, North Carolina, and Bedford, Virginia, showrooms in High Point and Ho Chi Minh City, Vietnam, and eight distribution centers in North Carolina, Virginia, California, China and Vietnam. Combined, Hooker Furniture Corp. and HMI have approximately 900 employees worldwide.

Operations are expected to remain autonomous. However, Toms added, "We do see opportunity to improve each business by sharing best practices and looking for ways to work together to lower costs, improve efficiency and grow sales."

Ranked among the nation's top 10 largest publicly traded furniture sources based on 2014 shipments to U.S. retailers, Hooker Furniture Corp.'s  casegoods product categories include home entertainment, home office, accent, dining, and bedroom furniture primarily in the upper-medium price points sold under the Hooker Furniture brand. 

Hooker's residential upholstered seating product lines include: Bradington-Young, a specialist in upscale motion and stationary leather furniture; Sam Moore Furniture, a specialist in fabric upholstery with an emphasis on cover-to-frame customization; and Hooker Upholstery, which focuses on imported leather upholstered furniture targeted at the upper-medium price-range. The Homeware product line offers direct-to-consumer, customer-assembled, modular upholstered and casegoods products. The H Contract product line supplies upholstered seating and casegoods to upscale senior living facilities.

Home Meridian International is the parent company of five business units including Pulaski Furniture, Samuel Lawrence Furniture, Samuel Lawrence Hospitality, Prime Resources International and Right 2 Home. Sourcing Solutions Group and Right 2 Home also provide customized and proprietary products and services to HMI partners.

 

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