Nautilus Partly Sells Assets, Will Focus On Direct And Retail Business
Nautilus, Inc. completed the sale and licensing of certain assets of its commercial business to Xiamen World Gear Sports Goods Co., Ltd. The commercial business serves hotel spas and public gyms.
The sale included certain assets of the StairMaster and Schwinn commercial product lines, including licenses of indoor cycling products of the Schwinn brand for use in the commercial channel, which primarily consists of health clubs.
Under the terms of the asset purchase agreements, Nautilus received a cash payment of approximately $7.9 million at closing and expects to receive approximately $2 million in additional cash payments within sixty days of closing, as well as another $1 million over the next three years.
Additionally, the company is entitled to receive certain royalties based on World Gear’s post-closing sales of Schwinn commercial indoor cycling and StairMaster products.
Nautilus retained certain rights to the Schwinn brand and will continue to market Schwinn fitness products in the consumer channel, including both retail and direct-to-consumer. Furthermore, the agreement not involve Schwinn products which are sold in the retail and direct sales channels, which Nautilus will continue to sell.
“We are pleased that we have completed this important step toward our goal of focusing exclusively on our direct and retail channels,” said Edward Bramson CEO of Nautilus, in a statement. “We are confident that the expected divesture of the remaining Nautilus-branded strength and cardio commercial lines during 2010 will ensure that these commercial products will continue to be available for health clubs and fitness centers for the future.”
Nautilus is working with Robert W. Baird & Co. to divest its remaining commercial assets, including Nautilus-branded strength and cardio lines and its manufacturing plant in Virginia.
