Waterford Wedgwood on acquisition trail worth between $100m-$200m

Waterford Wedgwood, the luxury goods group, is seeking acquisitions worth $100-$200 million and will consider larger deals, its newly appointed president and chief operations officer said yesterday. The group will seek to purchase leather, luggage or watch producers, Mr Redmond O'Donoghue said.

Waterford wanted to double its size in the next five years, added Mr O'Donoghue, who was chief executive at Waterford Crystal before the change. Current annual sales are approaching $1 billion.

While the group's four autonomous divisions previously reported individually to its non-executive chairman Dr Tony O'Reilly, Mr O'Donoghue will take overall operational control of the business and guide its strategic direction in the newly created position.

Mr John Foley, Waterford Crystal's former sales and marketing director, will replace Mr O'Donoghue at the glass division.

The group will concentrate on organic growth and acquisitions, Mr O'Donoghue said.

The existing business includes Waterford Crystal, ceramics firm Wedgwood, porcelain company Rosenthal, and All-Clad, a producer of professional cookware.

"All these brands have the potential to increase their market positions across the world," said Mr O'Donoghue.

Of the expansion strategy, he said: "I would like the next acquisition to be beyond crystal and ceramics - some other luxury products like leather or luggage or watches.

"The only thing I think I would add is they would have to meet our criteria for growth, but also the size we could digest. Between $100 and $200 million is our size. That would inform our thinking in terms of the acquisitions available to us."

But the group, which paid €10.2 million for German porcelain firm Hutschenreuther last month, has not ruled out larger deals. "If the right one came along I would consider it," Mr O'Donoghue said.

Besides stating that the group would target "brand-led, market-led" firms, Mr O'Donoghue declined to specify which companies it wanted to acquire. Neither would he specify a direct timeframe for the strategy.

There was "no list", he said. "We have an opportunity for acquisitions if the acquisitions would meet the criteria we have."

On the reorganisation, Mr O'Donoghue said it had been agreed following "lengthy discussions" with Dr O'Reilly in the past two weeks.

The new structure would enable the group to focus on strategic growth. This was distinct from management at its four divisions pursuing individual strategies.

"The size is such and the complexity is that we need someone in the centre to whom these divisions can report. This is giving them someone at the centre to whom they can all respond."

But Mr O'Donoghue added that the group's divisions would retain their autonomy. "I don't envisage a big group organisation with group a marketing division. We're not that kind of organisation."

Waterford reported a 31 per cent rise in pre-tax profits to €18.2 million in the six months to the June 30th last, when compared with its first half last year. Sales rose 30 per cent to $447 million in the period.