Handy brand for Pentland: Group pays pounds 12m for goalkeepers' glove-maker Reusch

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PENTLAND has added to its collection of sportswear brands with the pounds 12m acquisition of Karl Reusch, the German maker of goalkeeping and skiing gloves.

Three out of every four goalkeepers in this month's World Cup, including Gian Luca Pagliuca of Italy and Claudio Taffarel of Brazil, will wear Reusch gloves, which retail for up to pounds 50 a pair.

Reusch, founded in 1934 by the father of Gebhard Reusch, the present owner, moved into the sports goods market in the early 1970s. Reusch's ski gloves are worn by the national ski teams of Austria, France, Germany, Norway, Sweden, Switzerland and the US.

Reusch, which also makes other sports clothing and equipment, is being bought for an initial DM30m ( pounds 12m). A profit-related earn-out over the years 1997-99 could add DM20m to the bill.

Pentland's brand portfolio already includes Speedo, Ellesse, Pony and Berghaus. But it is looking for more. 'We continue to have irons in the fire,' said Frank Farrant, finance director. The company has net cash of around pounds 173m, mostly the legacy from its 1980s investment in Reebok, the US sports shoe maker.

A large element of the purchase cost of Reusch, which has net assets of DM6m, is goodwill. Reusch, which licenses its products in 26 countries outside Germany, made DM10m before tax in the year to 30 April 1993. Operating profits, before unspecified interest costs, of at least DM12m have been warranted for 1993/94.

Most of its products, in common with Pentland's other goods, are sourced from the Far East. A small factory outside Stuttgart in Germany and a joint venture in Hungary are principally finishing operations.

Mr Reusch will retain ownership of the German company's land and buildings, which will be leased to Pentland for DM450,000 a year. Pentland has the option to buy these assets after five years for DM8m, or for DM10m after 10 years.

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