Private Cutlery

Publicly Traded for Almost 130 Years, Tableware Maker WMF to Go Private

No fans of American table manners. Source: DPA
No fans of American table manners.
  • Why it matters

    Why it matters

    The firm best known as a maker of high-quality tableware has been publicly traded for almost 130 years, but it is undergoing a radical restructuring.

  • Facts


    • U.S. and Austrian investors have taken control of WMF and are taking it private.
    • Workers and unions are nervous because 600 jobs are at risk in the restructuring.
    • WMF is having difficultly warding off an increasing number of low-cost competitors.
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For the past 127 years, tableware maker WMF has been traded on the Stuttgart stock exchange – longer than any other company in the southwestern German state of Baden-Württemberg. But that is soon to be over. Handelsblatt has learned that WMF’s investors intend to delist the tradition-rich firm soon.

American investors KKR Financial Holdings and Austrian investment group Fiba, who have held 97 percent of the kitchenware company’s common stock for some time, now have secured 75 percent of its preferred shares through a public offering and control about 90 percent of the capital stock. The partners are in a position to force the remaining stockholders out and remove WMF from the stock market.

The investors had to fight hard to achieve this goal. KKR had originally offered a stock price of €53 ($69.80). When it became clear not enough shareholders were going to accept the offer by the August 11 deadline, the investors increased the price to €58 and extended the deadline to August 25.

Majority-owner KKR, which first bought shares in WMF two years ago, has complete control along with partner Fiba. It has already been announced the board will drop from three members to two. Board member Ulrich Müller is to leave WMF effective August 31 for “personal reasons.”

The company known for its high-quality cutlery and cookware is in the throes of a radical restructuring. Some 600 of 6,100 jobs are at risk. At the same time, about 40 of its 230 stores are marked for closure, and 33 logistic centers are to be merged into two locations.

004 WMF

In 2013, operating profits dropped by 44 percent to €47 million and net profit by 34 percent to €25 million. Sales stagnated at about €1 billion. Although operating profits rose again in the first half year, it was mostly because of the sale of low-price subsidiary Princess.

The worries are naturally running high at trade unions and the firm’s worker councils.

“It fills me with a deep sense of sadness to see the oldest company on Baden-Württemberg’s stock exchange now disappearing from the stock market floor,” said Bernd Rattay, business manager of IG Metall Goeppingen-Geislingen, “a bit of tradition is ending with it.” Mr. Rattay fears WMF will be saddled with debts the acquiring companies incurred to take over WMF.  “This will certainly be of no benefit to the workers,” said Mr. Rattay, noting the union will ensure impingement of Germany’s famed worker co-determination doesn’t occur.

WMF must perform a difficult balancing act in warding off the increasing number of low-cost competitors while not diluting its own good brand.

In July, workers and union representatives demonstrated their opposition to the planned restructuring. About 2,500 people, among them relatives and politicians, formed a human chain around the plant’s grounds in Geislingen, about 37 miles southeast of Stuttgart. The protesters waved banners such as “KKR is destroying our trade.” Their anger was also directed at the savings banks that substantially financed KKR’s entry in 2012.

WMF must perform a difficult balancing act in warding off the increasing number of low-cost competitors. On the one hand, the company is trying to compete with its own cut-rate line, but on the other it cannot dilute the brand still yielding good returns in the premium segment of the market.

WMF has been earning its good reputation for over 150 years. In 1853, mill owner Daniel Straub and brothers Louis and Friedrich Schweizer founded a metal workshop called Metallwarenfabrik Straub & Schweizer in Geislingen. The company has carried the name Württembergische Metallwarenfabrik since it merged with the Ritter & Co. metalware factory in 1880.

WMF’s success is based, above all, on the development of durable stainless steel that has been used for tableware since 1930 under the name Cromargan. At the end of the 1960s, according to its own accounts, the company also developed the world’s first fully automatic coffee maker.

This article was translated by David Andersen. Vinny Kuntz also contributed to this story. To contact the author:

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