The two leading luggage brands in the incentive market are about to become one. On March 3, Samsonite International S.A., the world's largest maker of name-brand luggage, and Tumi Holdings Inc. announced that Samsonite would buy its rival for $1.8 billion in cash.
The agreement, which has been approved by both companies' boards, is expected to close in the second half of the year.
"This is a great fit for us as a company," said Pete Mitchell, director, B-to-B sales, of Samsonite. "Tumi is a strong brand that dominates the luxury market in the U.S. and is strong in Asia."
The combination will also provide Samsonite with a key piece of the market it has long been lacking in the U.S. generally and in the incentive arena in particular: a high-end, business-luxury brand. "In Asia and Europe, Samsonite is like them -- we sell at one price, we are seen as a luxury brand," added Mitchell, who represented Tumi in the incentive channel about a decade ago. "In the U.S., we are seen as upper-middle tier. So this gives us that strength in U.S. as well."
This is a space that Tumi has long been dominant in, with business cases and luggage ranging in price from $200 for totes up to $1,800 for the largest four-wheel checked luggage in its rugged, iconic black ballistic nylon. Tumi has added colorful designs to its line-up in recent years, as well as a large and growing line of premium business accessories and travel electronics.
An area Samsonite is particularly strong in is its distribution network, and the company plans to use this to expand Tumi's brand more aggressively into the European and Asia markets, while also strengthening its position in the U.S., said Ramesh Tainwala, CEO of Samsonite, when announcing the acquisition.
One thing that won't change is the strong and longstanding commitment both Samsonite and Tumi to the incentive and special markets space and the industry organizations that serve it, said both Mitchell and Mike Landry, vice president, special markets, of Tumi.
"We are excited about the tremendous benefits that this transaction offers," said Landry. "Until the transaction closes, Tumi and Samsonite will continue to operate as independent companies. We will continue to fill all orders on time and in the normal course, as usual."
"I don't anticipate any changes in special markets," Mitchell added.