Modern furniture giant Herman Miller Inc. is entering into a deal that will create a powerhouse in design-driven furniture at a time when consumers are focused on their homes and home offices.
Herman Miller, a company that is known for its high-performance “task” chairs and whose brands include Design Within Reach, has agreed to acquire rival Knoll Inc. for $1.8 billion. Under the terms of the deal, Knoll shareholders will receive $11 in cash and 0.32 share of Hermann Miller for each Knoll share owned. Upon the completion of the deal, current Herman Miller shareholders will own about 78% of the combined entity, while Knoll shareholders will hold about 22%.
“This highly complementary combination will create the pre-eminent leader in modern design, catalyzing the transformation of the home and office sectors at a time of unprecedented disruption,” the companies said in a joint statement.
The two companies combined have 19 leading brands, 64 showrooms, more than 50 stores, a global deal network and a presence in more than 100 countries along with an extensive e-commerce network. The combined company will have pro forma annual revenue of roughly $3.6 billion and pro forma adjusted earnings before interest, taxes depreciation and amortization of about $552 million.
Andi Owen, president and CEO of Herman Miller, will become president and CEO of the combined company. Andrew Cogan, Knoll's chairman and CEO, will leave the company when the transaction closes after 30 years with Knoll.
“This transaction brings together two pioneering icons of design with strong businesses, attractive portfolios and long histories of innovation," said Owen. "As distributed working models become the new normal for companies, businesses are reimagining the office to foster collaboration, culture and focused work, while supporting a growing remote employee base. At the same time, consumers are making significant investments in their homes. With a broad portfolio, global footprint and advanced digital capabilities, we will be poised to meet our customers everywhere they live and work."
The transaction is expected to close by the end of the third quarter of calendar year 2021.