GRAND RAPIDS, Mich. -- Steelcase Inc. has signed a definitive agreement to acquire Halcon, a Minnesota-based designer, and manufacturer of precision-tailored wood furniture for the workplace. The transaction is expected to close during Steelcase’s second quarter of fiscal 2023.
It involves the acquisition of all outstanding equity interests in Halcon for $127.5 million and includes an adjustment for working capital and potential additional consideration of up to $9.5 million to the seller over three years based on the achievement of certain performance targets and continued employment of Ben Conway, current president of Halcon.
The acquisition is expected to bolster Steelcase's revenue. Currently, Steelcase is the fifth largest company in the FDMC 300 ranking with nearly $2.6 billion in sales and is the second largest company in the contract furniture marketplace behind MillerKnoll. Prior to the Herman Miller acquisition of the Knoll Group in July 2021, Steelcase had held the number one ranking in this market segment.
The Stewartville, Minn.-based Halcon posted revenue of approximately $70 million over the previous twelve months through April 2022, and its backlog of customer orders was approximately $56 million as of the end of April 2022.
Halcon has experienced growth over the last several years, including an 18,000-square-foot facility expansion in 2019, increasing the total to more than 300,000 square feet, and investing heavily in new equipment to improve efficiency.
“We see many opportunities for growth between the two companies going forward, including geographic expansion, portfolio enhancement, and continued revenue gains in Halcon’s existing core markets,” said Allan Smith, senior vice president, and chief revenue officer of Steelcase.
Established in 1977, Halcon produces custom wood and executive-level tables, credenzas, and desks. The company’s portfolio features patented award-winning furniture collections for today’s private office, open-plan, and collaborative spaces. Halcon’s range of sophisticated solutions elevates the worker experience with thoughtful and innovative details.
“At Halcon, we combine manufacturing flexibility, craftsmanship, and exceptional service to solve the unique needs of our clients,” said Conway. “We’re thrilled to join Steelcase and together expand the reach and impact of our products while remaining committed to our existing customers, distribution channels, and workforce.”
Steelcase and its community of brands offer an extensive selection of solutions and services designed to support the way people and organizations want to work today.
“From private office to conference rooms, we were attracted to the Halcon brand for their fine craftsmanship that enables organizations to create a signature, custom-designed workplace environment. When matched with our shared commitment to quality, sustainability, and service, Halcon is a natural fit for our community of brands,” said Smith. “We expect to drive strong growth by making the Halcon portfolio even more accessible to our customers, A+D professionals, and dealers. We believe Halcon’s success is rooted in its commitment to quality and long-term partnership with A+D firms, clients, suppliers, the dealer community, and employees, and we expect that to continue."
The expected acquisition builds upon previous acquisitions aimed at growth by delivering a broad portfolio of products, including the acquisitions of Viccarbe, Orangebox, AMQ, and Smith System, supplementing a leading portfolio and offering greater choice and value to Steelcase customers globally. Steelcase has previously announced marketing and distribution relationships with Blu Dot, Bolia, Carl Hansen & Son, EMU, Extremis, FLOS, Mattiazzi, Microsoft, Mitchell Gold + Bob Williams, Moooi, Nanimarquina, PolyVision, Tom Dixon, and West Elm.
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