Steinway Pianos Sold to Private Equity Firm for $438 million
Monday, July 01, 2013 - 12:00 PM
Leif Ove Andsnes tests the New York Steinway.
(Eileen Delahunty/WQXR)
WALTHAM, Mass. (AP) -- The famed piano maker Steinway is being acquired by private equity firm Kohlberg & Co. for about $438 million.
Steinway, which has been in business for 160 years, said previously that it was looking into selling the company.
Kohlberg, which would take the company private, will start a tender offer to buy all of Steinway's outstanding stock for $35 per share, a 15 percent premium to its Friday closing price of $30.43.
The board of the Waltham, Mass., company unanimously recommended Monday that shareholders tender their stock.
The deal includes a 45-day "go-shop" period in which Steinway may seek out alternative bids.
Steinway & Sons was founded in 1853 in a loft on Manhattan's lower west side. Its products include Bach Stradivarius trumpets, Selmer Paris saxophones, C.G. Conn French horns, Leblanc clarinets, King trombones, Ludwig snare drums and Steinway & Sons pianos.
"Kohlberg's long history of collaboration to grow and expand some of the world's leading consumer brands makes us an ideal partner for Steinway to accelerate its global expansion, while ensuring the artisanal manufacturing processes that make the company's products unique are preserved, celebrated and treasured," Kohlberg partner Christopher Anderson said.
Shares of Steinway Musical Instruments Inc. jumped $4.62, or 15 percent, to $35.05 in morning trading. Shares this year have risen close to 70 percent.
The transaction is expected to close in the third quarter.
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Comments [7]
If I had a great amount of moolah, money, gilt, etc. I would purchase the Steinway Mansion in Long Island City. What a beautiful Victorian. The tv show, Selling New York, took a side trip with Michael Feirstein(?) the pianist and singer to view the property. It would take so much money to renovate.
Hope this does not affect the quality.
Many famous companies have taken the Moneyway, the way Steinway is going at the expense of their quality piano. Just wait and listen.
One can only hope that the new owners do not follow MGM'S role in the way it treated its actors in the films that encouraged major actors to form UNITED ARTISTS. Financiers and bankers without the credentialing background tend not to have the imagination nor discipline to do the avant garde or extraordinary films that are artistic AND MONEYMAKING for the best of reasons.
I hope this sale doesn't turn out like the sale which gave us "improvements" such as Teflon parts that, well, were Teflon and sank the quality of Steinway for many years, making their once-stellar quality somewhat inconsistent and not the shining example of past glories. Let's hope the new owners will have the good sense to do right by the company and especially the consumers - us.
No, No, No.....assembly line pianos....products, plastic parts, amplifiers, and maybe some pyrotechnics to entice the younger generation......
I sincerely hope that this buyout of Steinway does not affect the company's long tradition of quality manufacturing. From personal experience, I have seen that when a company is acquired by an outside concern, the emphasis shifts to cost cutting, increasing profits, and ramping up production, usually at the expense of quality product(s). Buy your new Steinways now!
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