Best Buy Co. Inc. said on Thursday that it agreed to acquire privately held Pacific Sales Kitchen and Bath Centers Inc. for $410 million.
Torrance-based Pacific Sales operates 14 stores in southern California that sell high-end kitchen appliances, bathroom fixtures and home furnishings. The purchase price represents approximately 0.95 times Pacific Sales annual revenue, Minneapolis-based Best Buy said in a statement. The retail store operator expects the acquisition will be accretive to the company in the second half of fiscal 2007.
Best Buy said it expects the deal to close in the middle of January 2006. Following the close, Pacific Sales would operate as a wholly owned, indirect subsidiary of Best Buy.
Best Buy said it expects to expand the number of Pacific Sales stores, using the company’s successful showroom format, but it didn’t say whether the stores would be outside of southern California. Half of the stores are currently in the Los Angeles area.
Jerry Turpanjian, Pacific Sales’founder, president and CEO, plans to retire from his current role at the close of the acquisition and will continue to serve as a consultant to the business. David Sheek, general manager, and Glenn Merlian, vice president and operations manager, will remain with the company in their current roles.
Pacific Sales, founded in 1960, currently employs about 350 people, including a non-commissioned sales force. It expects to generate revenue of approximately $320 million this year.
Banc of America Securities LLC served as Pacific Sales’ financial advisor on the transaction.