Tuesday, January 1, 2013

Viking Range joins McRaes, Jitney, McCarty Farms, DGNB

Another Mississippi business sold out. The Wall Street Journal reported:

"Middleby Corp. acquired Viking Range Corp., a maker of high-end cooking ranges and related equipment, for $380 million, betting on a continuing recovery in the U.S. housing market.

Based in Greenwood, Miss., Viking has annual sales of about $200 million. Middleby, an Elgin, Ill., maker of commercial cooking equipment, expects 2012 sales of nearly $1 billion.

Viking was owned by Stephens Group LLC, a private-equity firm based in Little Rock, Ark., and Viking founder Fred Carl Jr. Neither Stephens nor Mr. Carl could be reached for comment.

Middleby said Monday that it would incorporate its speed-cooking, induction and other technologies into Viking equipment, while reducing costs. Middleby Chief Executive Selim Bassoul said some of his company's commercial equipment can cook a frozen turkey in 20 minutes.

Along with commercial equipment, Middleby sells residential appliances under the Jade and Turbochef brands. Before the Viking purchase, though, residential sales accounted for only 1% to 2% of Middleby's total.

"We believe that the U.S. housing market is now really growing," Mr. Bassoul said. That growth, plus kitchen renovations, should spur sales of professional-style cooking equipment, he said. Mr. Bassoul said he bought a Viking range for his home about 12 years ago.

Viking ranges retail for between about $3,000 and $8,000.

Mr. Carl, a former home builder, founded Viking in the 1980s after noticing that some of his customers wanted restaurant-style ranges. Commercial stoves typically aren't practical for use at home, partly because they need large ventilation systems.

Mr. Bassoul said Mr. Carl would continue to run the Viking business and that Middleby doesn't plan to close Viking's factories, which are in Greenwood.

Viking should be able to expand its sales in Asia and the Middle East as well as in the U.S., Mr. Bassoul said. About six years ago, before the U.S. housing bust, Viking sales were about $400 million a year, about twice the recent pace, he said.

Viking's earnings before interest, taxes, depreciation and amortization have been about 10% to 12% of sales recently, Middleby said. The company expects the acquisition to have a negative effect on earnings per share in the first half but to turn positive in the second half.

Viking was one of the best-known independent makers of luxury kitchen appliances. Another independent company in the industry, Sub-Zero Inc., known for its refrigerators and Wolf ovens, is owned by the family of CEO Jim Bakke.

A spokeswoman for Sub-Zero, which is based in Madison, Wis., said the company isn't for sale.


Nice to see another Mississippi business owner choosing to keep our economy in last place.

31 comments:

Shadowfax said...

I'm just now learning Primos (sporting calls, etc) sold a year or so back. Over time, and consistently, that brand will probably sell more than Viking.

Lumbergh said...

How is a business owner choosing to sell HIS business a choice to keep the State's economy in last place? Easy to forget that Mr. Carl stepped up and sponsored the Viking Classic at a time when their business had been cut in half by the economy. If he hadn't stepped up, there probably wouldn't be a PGA event in Mississippi.

If this state wants to get out of the economic cellar, we need to figure out how to create more Fred Carls and Will Primos...not criticizing them for reaping the rewards of a lifetime of work.

Anonymous said...

One less thing to be proud of.

Anonymous said...

We need a Whole Foods in every Mississippi community. That will solve everything.

meople said...

There were many PGA tour events in the SIP before Viking classic (see southern farm bureau) and there will be many more after it.

Anonymous said...

Well said Lumbergh!

Anonymous said...

The Ramey Agency was also part of the Viking properties. Does anybody know if they were sold too?

Shadowfax said...

Fred has heavily invested himself and his business talent in the Greenwood economy for decades, also rebuilding the Alluvian Hotel. While most of the Delta was turning to shit and people with resources were bailing, he stood firm and sunk a fortune in the community.

Keep in mind that Bennie Thompson would have been first in line to support union organizing at the Viking plant. And still will be if he gets the chance or the new owners don't pull out.

Anonymous said...

don't forget Gail Pittman sold out to china a few years back...

Ophelia said...

Since when are entrepreneurs, especially successful ones like Mr. Carl and Ms. Pittman, under some holy obligation to forever stay obstinately Mississippi-bound, when a lucrative opportunity to sell arises? Lumbergh is spot-on. VERY well said, indeed!

Anonymous said...

Don't forget Lamar Life and Standard Life.

Anonymous said...

Another marbles-in-his-mouth comment from Lumbergh. The dang golf tourney has nothing to do with any of this.

PittPanther said...

Lumbergh is spot-on. For such a conservative blog, the comments are amazingly anti-business. Instead of complaing about Viking selling out, what we should be doing is having a thousand companies like Viking, here in MS. That way they could come and go without the endless hand-wringing and fear you guys are demonstrating.

Anonymous said...

9:02
You are correct.
The golf tournament has nothing to do with a bunch of envious asshole posters, who would sell in a second if only THEY had spent their lives building something of value.
I say more power to those that actually built something.

Anonymous said...

PPanther. Blah, blah, blah, blah.

Show the anti-business comments.

Shadowfax said...

The tournament, 9:02, is a testament to the philanthropy of Mr. Carl. In that regard, it indeed has something 'to do with this'. Those chirping about selling out remind me of the Clarion Ledger's position ten or so years ago when some were abandoning Capitol Street and government offices were looking at moving out of town.

Eric Stringfellow devoted an entire column to his (Gannett's) position that those inhabiting downtown owed it to the community to stay there forever and not enrich themselves or their business footprint by moving north of County Line. In other words, By God, go down with the ship no matter what.

Mr. Carl has more than done 'his part'. The same is true, I assume, of Mrs. Pittman. And Mr. Primos.

Anonymous said...

Truth be told...Viking has been in trouble for some time and most of the equity was not MS based.

Anonymous said...

That's the great part about this blog. For all of the fierce 'conservatism' preached, when Fred Carl opts to sell his business that he built, he's called a sell-out. He's accused of betraying his state.

But of course, building up a business and selling at a great opportunity is just standard capitalism, and should be lauded by those who follow this blog fanatically.

Of course, when you come from a state that rails about how it wants its 'freedoms' without federal interference, and at the same time is one of the highest per capita receivers of federal largesse, you get pretzel thoughts like above.

Viking is a great company. More than likely, the deal includes some continuing obligation for Mr. Carl to be involved in the Mississippi operation to prevent the thing so feared in this post. I don't know that, but neither do you as far as I can tell from the post.

Anonymous said...

I think what makes me sad is that its another very widely known name, a Mississippi company, that is not going to exist anymore. Its not wishing anything bad on the sellers/owners or denying that they deserve great things.

Its just sad to see our state's successful names (like Viking, McRaes, Jitney J, etc.) go by the wayside.

Anonymous said...

Despite assurances to the contrary from Viking and the new owners, I look for the business to leave Greenwood in a couple of years. Maybe sooner once the new owners get tired of dealing with Sen. David Jordan and the other idiots that comprise the Greenwood City Council. As for the Ramey Agency, it will be tough to replace the billings for Viking. I'm not sure how the billing was done since Viking actually owned the agency, but without Viking's business, the Ramey Agency will be hurting. Their work is mediocre at best. They're probably regretting their pricey move to Fondren about now. T

Anonymous said...

capitalism 101 aside, take a look at the home grown business landscape. rather than continue to grow the business, inheritors (and a few creators) cashed in. buyers have relocated, shut down or broken up. and downtown jackson, once a thriving center of local capitalism, is gutted. name one multigenerational privately created and owned local business with more than 50 employees. while viking may be a bad example of all of the above, another one bites the dust.

Burke said...

My question has always been, what did the selling families do with the money? Too often, as we have seen, the benefits of the sale go to a second or third generation that is much less distinguished than the founders. In that case, we can only hope that they will be generous, and many of them are. And then there are the less frequent instances where the beneficiaries take a good portion and reinvest it in new businesses. Slowly we are building up the capital base in our beleagured state.

Anonymous said...

Ramey could diversify and market Fondren's beautiful surface pipe based sewage system being built there. Maybe they could get some guest commentary from William Winter or Haley Fisackerly. Ramey could popularize a self-guided walking or biking tour to allow Fondrenites and other Jacksonioans to appreciate the engineering and green pipe aesthetics. Ramey relocated to Fondren at exactly the right time!

Anonymous said...

12:05, Let me take a shot at your question. Start with the two Mississippi Companies that are in Fortune's top 50 - Ergon (Lampton family) and Yates Construction and associated companies. While at it, Southern Pipe and Supply, Howard Industries, Sanderson Farms. I’m sure could go on, but…..

Frankly, I am happy and proud for those that build and "cash in" as has been said here. Oftentimes, the selling of these companies to others is a way to expand. Not everytime does the company leave - that is the job of our local officials, to provide an environment where they want to stay and expand some more.

I to worry that Viking may well move much of its base away from the Delta. Fred Carl fought hard to keep his business in his hometown and provide benefits for the area - and did it oftentimes while having to fight those he was trying to help. If Greenwood and the other Delta towns where he has provided employment don't step up and make the climate a welcome one, Viking's presses will be as idle as those of other companies that occupied these same facilities before Viking expanded into the buldings.

Anonymous said...

None of this means squat. WHOLE FOODS HAS CHOSEN JACKSON!

Shadowfax said...

"Burke said...
My question has always been, what did the selling families do with the money?"

I can't get a grip on what difference that makes or what business it is of yours or mine, Burke.

Anonymous said...

Shadow - find my agreeing with you (at least, this time!) I assume they did whatever the hell they wanted to do with the money. It is theirs. Today's government tends to think it is the government's to do what they think is best, but so far, that is not the case. Too bad Burke obviously thinks differently.

Shadowfax said...

As if folks with demonstrable assets are somehow obligated by a societal rule to fold their wealth back into the community. Or maybe redistribute their personal wealth as commanded in some fictitious Bible verse that nobody can pinpoint. Burke is left to ponder.

Ophelia said...

I must admit that I, too, am in strong agreement with Shadow this time. To say, or even imply, that a successful businessman/woman who sells at great profit has ANY obligation whatsoever to plow the proceeds back into the state in which they "grew" their enterprise, sounds miiiiiighty suspiciously like that stupid Obama assertion that "[they] didn't build that business!" Of course they did, and if they want to spend their windfall on vintage Ferraris, French chateaux, racehorses, or even whores, that "ain't nobody's business but their own".

As Burke pointed out, many, if not most, lucky beneficiaries do nice charitable things with their inherited pile. But that's optional, not obligatory. And I'd be lying if I didn't say that, had I been blessed enough to inherit more than a silver tea service, the first recipient of my $$ would be Air France or Alitalia, and it would be a one-way ticket. Mississippi is a sinking ship, and who, with any choice in the matter, would willingly go down with it?

The real wonder is why so many heirs STAY!

Anonymous said...

Viking Range was sold years ago, to Stephens Inc. of Little Rock, Arkansas. The real reason for the sale now is nothing to do with the wishes of Fred Carl, but rather the wishes of Stephens, to monetize their asset.

The real telltale piece of info in this press article is the quote from the Middleby CEO: "Middleby said Monday that it would incorporate its speed-cooking, induction and other technologies into Viking equipment, while REDUCING COSTS" (emphasis mine). So Middleby wants to be able to sell a Viking Range for $4000 instead of $8000. Which means the quality is going to go downhill, and there is no logical reason for this company to keep their production in Greenwood, MS.

Fred Carl and his wife are probably pushing 70. We can't all expect them to prop up the entire Delta on their own. They have done amazing things. It will be sad, though, when Viking leaves. I don't see any other way around it.

Shadowfax said...

If I'm not mistaken, Fred is 64, but WTF difference does that make?



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