The American private equity owners of Waterford Wedgwood are selling the historic ceramics and glassware maker six years after the company's debts sank it into receivership.
KPS Capital Partners has appointed Goldman Sachs to auction WWRD, the Anglo-Irish owner of the Waterford, Wedgwood, Royal Albert and Royal Doulton porcelain and crystal brands. Wedgwood, one of Britain's best-known brands and a driving force in the industrial revolution, was founded in 1759 by Josiah Wedgwood.
WWRD would not comment on the sales process on Sunday but said: “As a profitable and strongly performing global business under private equity ownership, options for the next phase of growth are constantly under review. KPS Capital Partners remains firmly committed to achieving the brightest possible future for the brands and employees of WWRD.”
The auction has attracted interest from several potential buyers from Asia, where the group made 40 per cent of its total sales of $450m in the financial year to April 2014. It has targeted China for expansion and recently signed a deal with a local distributor that will give it 57 shops in the country, up from 35.
The group hopes to cash in on its heritage and royal warrants after recently opening tea rooms in Shanghai and Hong Kong to appeal to affluent Chinese consumers; it also plans to diversify from manufacturing.
The collapse of Waterford Wedgwood in 2009 spelt financial disaster for Sir Anthony O'Reilly, who then owned the company and was once one of Ireland's wealthiest businessmen. His fortune was also ravaged by the debts of Independent Newspapers, the media group he once controlled.
At the time, Waterford Wedgwood was one of several British ceramics manufacturers struggling against cheap imports from Asia, but it was also criticised for a dated image and for failing to adapt to changing consumer tastes.
KPS Capital Partners, based in New York, specialises in acquiring lossmaking businesses; it bought Waterford Wedgwood from the receivers in 2009 for £82m after the group collapsed with € 800m of debts and pension liabilities.
Since KPS took over, the number of employees has shrunk 44 per cent — the result of centralising the group’s sales and marketing operations, and moving about half of production to lower cost overseas countries, including Slovakia and Indonesia.
As Michael Psaros, co-founder of KPS, said soon after the acquisition: "We help companies make more stuff with fewer people."
WWRD has since swung into the black, with operating profits last year of £36m.
The group still makes its most expensive china and crystal domestically. Last year, KPS invested £34m in a new manufacturing plant in Barlaston, Staffordshire, where the company has its headquarters.
(Copyright The Financial Times Limited 2015)
