manufacturer sold

[Dr. Spa™ Ret.]

Looks like MAAX bough L.A. spas

[Tman122]

Do you think MAXX will stick around? Seems like gobbling up small semi unsuccessful manufacturers leads to a bigger failure down the road unless it's backed by something bigger and it's semi successful companies.  Who's MAXX? Part of?

[TwinCitiesHotSpring]

Do you think MAXX will stick around? Seems like gobbling up small semi unsuccessful manufacturers leads to a bigger failure down the road unless it's backed by something bigger and it's semi successful companies.  Who's MAXX? Part of?

if they update their tubs (namely their molds and colors) so they don't look straight out of 1997 then they have a shot 

LA must have been struggling, I've noticed they have made much more effort into their products/website over the past couple years but that must have not equated into the sales numbers they were looking for...just an opinion/hunch, no facts backing it

[Dr. Spa™ Ret.]

From what I read, a large investment company came along and bought up the large "building complex" L A Spas was renting space from...then they split it all up and started selling off all the individual buildings. L A Spas couldn't afford to buy their building (not at all uncommon), and rather than trying to relocate, one of those "offers you can refuse" came along, in the way of MAAX.

[TwinCitiesHotSpring]

From what I read, a large investment company came along and bought up the large "building complex" L A Spas was renting space from...then they split it all up and started selling off all the individual buildings. L A Spas couldn't afford to buy their building (not at all uncommon), and rather than trying to relocate, one of those "offers you can refuse" came along, in the way of MAAX.

Interesting, I would assume they keep the name and are simply expanding MAAX's "territory"? after-all there not buying anything real proprietary or unique per see

[hottubdan]

They are buying name, dealers, molds, etc.

[Dr. Spa™ Ret.]

The article I read said they would be down for about 4 weeks as they move all the equipment and molds to Arizona. I tend to assume that they're hoping to keep all the existing dealers as well.

[Dr. Spa™ Ret.]

Thirty-eight-year-old hot-tub producer L.A. Spas has been sold.

MAAX Spas Industries Corp., a private-equity-owned producer in Chandler, Ariz. made the acquisition. While the firm would not disclose the purchase amount, it was characterized as being in the multimillions of dollars.

L.A. Spas will remain a distinct brand under the MAAX umbrella, joining California Cooperage, Elite Spas, MAAX Collection, PowerPool and Vita Spa, which was acquired by MAAX in 2009.

The sale of the brand will have very little impact from the consumer side, said Emil Nygard, vice president of MAAX Spas. Product selection will remain the same, and warranties will be honored, as will all the dealer agreements.

The sale, announced Dec. 4, was the result of an unusual property issue. L.A. Spas’ had leased its Anaheim, Calif., manufacturing facility. The property was sold in July.

“What looked like a fairly … benign change in the ownership of the building L.A. Spas [leased] turned into a pretty big event,” Nygard said.

Before long, the new owner told L.A. Spas it no longer wanted to lease the facility but preferred to sell it.

“Tenants had to either buy their buildings or move out,” said Brad de Koning, CEO of L.A. Spas. “The asking price of L.A. Spas’ space was approximately $12 million. While revenues grew 55 percent in the past three years, L.A. Spas re-invested significant capital in a major upgrade of the manufacturing process and in new products. The company’s free cash flow would not support the real estate transaction in the near term, and in a couple of years the company could outgrow the space altogether.”

L.A. Spas was not able to find a new manufacturing facility in the tight SoCal real estate market and began to explore a sale.

“It was not a distressed asset,” Nygard said.

L.A. Spas production is being moved to MAAX Spas’ Chandler plant. To accommodate the additional volume, MAAX will add a second shift and increase capacity.

“There will be a period of integration,” Nygard said. “We anticipate it taking somewhere from three weeks to four weeks to get the main selling products up and integrated, and then it’ll be an additional period of time before all the products are done.”

L.A. Spas production staff, some administration staff, production management and some sales managers will be offered positions with MAAX in Arizona. The day after the acquisition was announced, MAAX senior management was on site in Anaheim to hold a job fair of sorts for recruitment. There will be layoffs in some overlapping job functions, such as administrative positions and marketing.

“There are geographic issues: one is in LA and one is in Phoenix. We’re not sure how many folks will come over,” Nygard said. “We’re there to offer the jobs because that works out very good. Customer-service people, the trades that build the things – it’s better to have folks who know how to do it when you’re going to expand. It makes it easier for everybody.”

MAAX Spas is owned by Brookfield Asset Management, a private equity firm that encourages growth through acquisition. “We were under a constant look for these opportunities,” Nygard said. “… A lot of us have the extra capacity, especially since the recession, and since the fit was so good, we moved quickly with the deal.”

To help with the transition and support dealers, de Koning will consult with MAAX through the spring.