ST. LOUIS, MO - Harbour Group announced on Oct. 30 that it has acquired certain assets and the business of Grand Rapids, MI-based Rowe International Inc. Harbour purchased the jukebox manufacturer through a new entity, RWI Acquisition Corp. The purchase price was nearly $13 million, according to reliable sources. To land the purchase deal, Harbour outbid at least one other suitor while Rowe proceeded through a Chapter 11 restructuring; that legal process and Harbour's purchase transaction are both expected to close on Nov. 11.
Harbour Group, a privately owned company based here, and its related companies are engaged in the manufacture and distribution of industrial products, including high-pressure cleaning equipment, auxiliary plastic processing equipment, automotive accessories, hearth and chimney products and textile machinery, along with pre-engineered building components, heat exchange equipment, automotive enthusiast products and home maintenance products.
Rowe, the largest manufacturer of local-storage CD and broadband digital downloading jukeboxes, will become a part of Harbour Group's new entertainment portfolio, which was launched with Harbour's acquisition of Merit Industries Inc., the coin-op industry's leading manufacturer of countertop touchscreen video games, in December 2002.
"We are excited about the opportunity to work with such a great company, one that has a long history of excellent products and innovation and a stellar reputation in its industry," said Sam Fox, chairman and chief executive of Harbour Group. "Rowe has a talented management team and dedicated employees, an outstanding distribution network and a loyal and longstanding base of operators. With the strong financial resources of Harbour Group behind it, we believe that Rowe will continue to be an industry leader long into the future."
Doug Johnson, chairman and chief executive of Rowe, observed that the acquisition of Rowe by Harbour Group could not have come at a more "opportune time" for both companies. "Rowe led the transition from vinyl to CD jukeboxes in the early 1990s," he said, "and is once again poised to take the lead as the industry transitions to a digital Internet-connected platform."
Rowe filed a voluntary petition for protection under Chapter 11 of the U.S. Bankruptcy Code on August 29 to facilitate the sale of the company's assets to Alexander Enterprises Inc., an affiliate of the Alpha Private Equity Group, designated by the court as the "stalking horse," meaning other qualified bidders would have the opportunity to submit higher and better offers (see VT, Sept. and Oct.). Following a hearing held on Sept. 26, the court approved, among other things, motions related to deadlines for events and actions leading to the closing of the sale of Rowe on Nov. 11. Qualified bidders submitted competing bids on Oct.10 and a court hearing yesterday approved Harbour's bid, which topped APEG's offer. According to officials close to the case, five bidders qualified, but only Harbour and APEG took part in the late October hearing that approved the sale.