DANBURY, Conn. & CORTE MADERA, Calif.--(BUSINESS WIRE)--Apr. 12, 2016--
Waterworks, the premier luxury bath and kitchen brand founded in 1978 by
Barbara and Robert Sallick, and now led by Chief Executive Officer Peter
Sallick since 1993, today announced it has chosen to join forces with RH
– creating the first fully integrated luxury home platform in the world
– offering a complete collection for every room of the home, in every
channel, to both design professionals and consumers. Peter Sallick and
Ralph Bennett, President, will continue to lead the Waterworks brand
independently along with the rest of the leadership team from their
headquarters in Danbury, Connecticut.
Waterworks has long been the definition of the well-appointed bath, and
is the only complete bath and kitchen business offering fittings,
fixtures, furniture, furnishings, accessories, lighting, hardware and
surfaces under one brand in the market. Waterworks is comprised of the
Waterworks, Waterworks Kitchen and Waterworks Studio brands, all built
on a foundation of impeccable style, design integrity, quality and
craftsmanship. Waterworks products are sold through its 15 showrooms in
the U.S. and U.K., as well as its boutique retail partners, hospitality
division and online. The Company prides itself on its deep relationships
in the design community and the technical expertise and tenure of its
people.
Peter Sallick, Waterworks Chief Executive Officer commented, “We enter
this new partnership with a great sense of excitement and pride. We have
come to know RH, led by its Chairman and Chief Executive Officer, Gary
Friedman, as a special company with both the scale to make a difference
and the high touch and creative leadership to see the world at a
personal level. We've admired RH for their unique partnerships with
designers and artisans from around the globe, their ability to reimagine
the retail experience through the adaptive reuse of historic and
architecturally iconic buildings, and for the passion and innovation
they bring to our market.”
Mr. Sallick continued, "We believe the combined capabilities of our two
organizations creates an opportunity to amplify the authentic and
special brand we have built and accelerate the pursuit of our vision to
build the most innovative and inspirational bath and kitchen brand in
the world. Together, we will create a dramatic path toward long term
growth and value for our brand, people, customers and suppliers.”
Barbara Sallick, Waterworks co-founder and Senior Vice President of
Design stated, “We look forward to our partnership with RH founded upon
our mutual respect for great design, artisanal craftsmanship and product
innovation. Together with the RH team, whose creativity and market
leadership are inspiring, we expect to grow the Waterworks brand in the
luxury space while continuing to provide exemplary service to our
clients. Robert and I founded Waterworks 38 years ago following in the
footsteps of my entrepreneurial father who opened a plumbing supply
business in Danbury, Connecticut in 1925. With RH at our side, we
anticipate the rewarding adventure of building our company for many
generations to come.”
Ralph Bennett, Waterworks President added, “We believe RH is the most
significant brand being built in the home market today, creating
extraordinary opportunities for us to collaborate and benefit from their
unique and growing platform. As a combined organization, we look forward
to extending and expanding our passion, product offer and commitment to
outstanding service to our incredibly valuable clients.”
Gary Friedman, RH Chairman and Chief Executive Officer commented, "There
are certain brands that define their categories, like Hermès, Tiffany,
Apple, Range Rover and Ralph Lauren, and we believe that Waterworks is
one such brand. We have long held great admiration and respect for the
esteemed brand and business the Sallicks have built, and feel honored
and privileged to be partnering with the entire Waterworks team, as we
combine forces to further redefine the industry.”
Mr. Friedman concluded, “We are thrilled to add this prestigious brand
to our product platform, as it not only positions RH as an authority in
two of the most important rooms of the home – the bath and kitchen – but
also creates the first fully integrated luxury home platform in the
world. There are very few opportunities to partner with a well-managed,
growing, double-digit EBITDA margin brand such as Waterworks. This
partnership represents a key opportunity to drive long-term growth and
value creation for our shareholders.”
The transaction is valued at approximately $117 million, which is
subject to changes in working capital and other adjustments, and will be
funded from RH’s existing cash balances. Subject to customary closing
conditions, the transaction is expected to close during the second
quarter of fiscal 2016 and until that time the two businesses will
continue to operate as separate entities. Upon completion of the
transaction, Waterworks is expected to be accretive to RH’s fiscal 2016
earnings. RH will provide additional information to investors concerning
the anticipated financial impact of the transaction when the Company
reports first quarter fiscal 2016 financial results.
In connection with the transaction, Peter Sallick and Ralph Bennett have
agreed to invest in continuing equity interests in the Waterworks
business, which creates additional incentives for management to continue
to drive growth and profitability of the business in future periods.
About Waterworks
Co-Founded in 1978 by Barbara and Robert Sallick, Waterworks is based
firmly upon a foundation and commitment to design authenticity and
excellence. Led since 1993 by son, Peter Sallick, Chief Executive
Officer, Waterworks brings impeccable style and artisanal quality
craftsmanship to bathrooms and kitchens around the world. Each product
has a story to tell and is created through a unique collaboration
involving in-house and outside designers, craftsman, artisans, and
manufacturers. Highly regarded as a premier design resource, its
exclusive designs now encompass bath and kitchen fittings, fixtures,
furniture, furnishings, accessories, lighting, hardware and surfaces.
Waterworks products can be found in 15 showrooms across the US and UK.
Expanded distribution channels include: boutique retail partners, a
growing e-commerce business, as well a residential and hospitality
business across North America, Asia and Europe.
About RH
RH (Restoration Hardware Holdings, Inc. - NYSE:RH) is a curator of
design, taste and style in the luxury lifestyle market. The Company
offers collections through its Retail Galleries, Source Books and online
at RH.com.
Forward-Looking Statements
This release contains forward-looking statements within the meaning of
the federal securities laws including statements related to the
anticipated timing of the closing of the transaction, the expected
benefits of the minority equity in the business to be retained by
certain members of the Waterworks management team, the expected benefits
to be achieved from the acquisition of the Waterworks business by RH
including the creation of the first fully integrated luxury platform for
the home, the comprehensive scope of the merchandise assortments to be
offered by the combined company and the expectation that Waterworks will
be accretive to RH’s fiscal 2016 earnings, and any statements or
assumptions underlying any of the foregoing. You can identify forward
looking statements by the fact that they do not relate strictly to
historical or current facts. These statements may include words such as
“anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,”
“believe,” “may,” “will,” “should,” “likely” and other words and terms
of similar meaning in connection with any discussion of the timing or
nature of future events. We cannot assure you that future developments
affecting us will be those that we have anticipated. Important risks and
uncertainties that could cause actual results to differ materially from
our expectations include, among others, that any acquisition of a new
business is subject to operational and other risks of integration and
post closing operation; our ability to retain key personnel; successful
implementation of our growth strategy; general economic conditions and
the impact on consumer confidence and spending; changes in customer
demand for our products; our ability to anticipate consumer preferences
and buying trends, and maintaining our brand promise to customers;
changes in consumer spending based on weather and other conditions
beyond our control; risks related to the number of new business
initiatives we are undertaking; our ability to obtain our products in a
timely fashion or in the quantities required; our ability to employ
reasonable and appropriate security measures to protect personal
information that we collect; our ability to support our growth with
appropriate information technology systems; risks related to “conflict
minerals” compliance and its impact on sourcing, if any, as well as
those risks and uncertainties disclosed under the sections entitled
“Risk Factors” and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” in Restoration Hardware Holdings’
Form 10-K most recently filed with the Securities and Exchange
Commission, and similar disclosures in subsequent reports filed with the
SEC, which are available on our investor relations website at
ir.restorationhardware.com and on the SEC website at www.sec.gov.
Any forward-looking statement made by us in this press release speaks
only as of the date on which we make it. We undertake no obligation to
publicly update any forward-looking statement, whether as a result of
new information, future developments or otherwise, except as may be
required by any applicable securities laws.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160412006694/en/
Source: Restoration Hardware Holdings, Inc.
Investor Contact
RH
Cammeron
McLaughlin, 415-945-4998
cmclaughlin@rh.com
or
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Contacts
RH
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ksorokko@rh.com