News

Armour Group Acquires Alphason Designs (23/2/2006)

Armour Group plc, the UK's leading consumer electronics group focussed on the home entertainment and in-car communication and entertainment markets, has announced its acquisition of the leading home entertainment furniture manufacturer Alphason Designs Ltd. The acquisition has been undertaken to further strengthen Armour's position in a growth sector of the audio visual (AV) market driven by the increasing demand for flat screen televisions; to create a comprehensive UK distribution network into the consumers electronics market; and to deliver cost savings through improved sourcing of product.

Alphason, which was incorporated in 1985, has been designing, manufacturing and distributing specialist AV furniture for over 10 years, predominately marketed under the brand. It has established very strong distribution channels across the whole of the UK consumer electronics market with direct access to over 2,500 retail outlets that range from the specialist independent retailers through to the multiples that include John Lewis Partnership, Comet and Argos.

Commenting on the acquisition Glenn McClelland, Managing Director of Armour Home Electronics, said: "The market for specialist AV furniture is expected to grow over the coming years with the surge in demand for LCD and plasma televisions. There are currently approximately 60 million cathode ray tube ("CRT") televisions and 2.5 million LCD and plasma televisions in the UK.

"We believe that over the next five to seven years a significant proportion of these CRT televisions will be changed for LCDs and plasmas with a consequential increase in demand for the associated accessories such as AV furniture. As the leading branded independent supplier of such products in the UK, we expect Alphason to benefit from this conversion to LCD and plasma televisions."

Alphason Designs Ltd will be run as a separate operating unit within the Armour Home Electronics division. In the enlarged Group, Armour Home Electronics will account for approximately two thirds of the group sales and just over two-thirds in terms of profit contribution. The remaining third of the Group's business is generated from the automotive division, Armour Automotive. John Reddington becomes Managing Director of Alphason Designs Ltd and will sit on the Armour Home Electronics' Board of Directors

Commenting on the developments John Reddington said: "We are delighted to be joining Armour Home Electronics. The move not only enhances our position as the UK's number one AV home entertainment furniture supplier, but also gives us access to Armour's enormous resources in design and development, global sourcing and last, but not least, its excellent product range. With Armour as our parent our future looks even more exciting."

George Dexter, Chief Executive at Armour Group plc said: "I am delighted with this acquisition. Alphason has been one of the few stars in the consumer electronics marketplace for the past few years, repeatedly increasing sales and profits month on month and year on year against a generally difficult marketplace. It is recognised as the UK's market leader in its sector, a sector that I am confident will continue to grow driven by the conversion from CRT to flat screen TVs. The acquisition is expected to considerably strengthen Armour's position in the UK consumer electronics market and give the enlarged Group the ability to reach a wider consumer audience with its product portfolio."

www.armourhe.co.uk