Bang & Olufsen Sold

B&O Australia is set to become a 100% owned subsidary of B&O Worldwide. The deal which is set to be completed within 3 weeks could see a major re design of stores.

Bang & Olufsen Worldwide are set to take over the ownership of the B&O stores in Australia. The move will see the stores significantly upgraded to give them a more European look & feel. It is expected that the deal will be completed within three weeks. The Australian market represents 3% of B&O’s global sales

B&O Australia Managing Director Bevan Van Blerk confirmed the move to SmartHouse News saying that the issues outstanding were normal escrow and due diligence matter. “Once this deal is concluded we will have several tasks ahead of us including stores revamps and new marketing activities”.

The issue for B&O originally was whether to take 100% ownership of the 16 store Australian operation or cut a deal with another franchise partner. In the USA B&O own 10% of the US stores with the rest franchised.

Ownership issue emerged after the Melbourne based Smorgen family decided to bale out of Bang & Olufsen Australia. In recent weeks Escore Pty Ltd a 100% Smorgen owned Investment Company put the chain up for sale as a going concern.

Currently B&O operate 15 stores in Australia having recently closed one in WA. 5 of these 5 are B&O stores within David Jones. No other products other than those designed and manufactured by B&O are sold in the stores. This in itself is a problem for Escor as they have high fixed over heads and a range of expensive lifestyle products which are only purchased by a limited group of consumers.

In a letter to staff B&O Managing Director Bevan van Blerk told employees when the company first went on the market” Over the eight years that Escor has owned B&O we have invested considerable in expanding the business and showroom network. We now believe that the time is right for another interested party to take the business forward”.

He added “Bang & Olufsen International are providing their full support during the sales process. Given the brand reputation, long history and loyalty of our staff we are confident of a successful outcome”.

David Jackson Managing Director of Escore said at the time “It is time for us to divest of this asset and we are only just starting the process of looking for a buyer”.  

Escor is a private equity investor with a range of investment interests including Bang & Olufsen Australia, ES Group Trading, Espak Packaging Solutions, and Ridge Corp. The company has owned the distribution rights to B&O Australia for 8 years.