When I asked around about Yoshimura in advance of our conversation, most people told me two things. I again asked for an interview, and this time-to my surprise-he said yes. Then, amid the Bassett drama, Business of Home ran an article that erroneously referred to CSC Generation as a private equity firm, and Yoshimura reached out to correct the error. At the time, I reached out for an interview, and he politely declined. I’ve been aware of Yoshimura ever since his company bought One Kings Lane in 2020. CSC’s aggressive acquisition plays had only generated further skepticism in the trade press, and the coverage of Yoshimura sometimes depicted him as a vaguely sinister enigma-one article in Home News Now referred to Yoshimura as the “no-comment king” and a “buyout bully.” That, and a focus on digital transformation, tends to raise eyebrows in a disruption-wary industry where everyone knows everyone.
Yoshimura doesn’t appear at furniture business conferences and doesn’t speak to the press often, making him something of an unknown quantity.
If it happens, he’ll have pulled off an interesting feat: Building a home retail operation more than double the size of Ethan Allen that no one has heard of. One industry consultant described CSC to me as “a home for the fallen angels of the business.”Īll in, CSC brands employ thousands of people, and Yoshimura says that its revenue run rate is more than $1 billion annually-recently, he has written that the company could clock more than $2 billion in 2023. Mostly, it has been acquiring distressed home retailers at a steady clip-in addition to Sur La Table, Z Gallerie and One Kings Lane, it has picked up discount home goods membership club DirectBuy and a stake in furniture liquidator Home Consignment Center. After selling that business, he moved on to found a loyalty marketing platform, 500friends, for retailers out of the startup incubator Y Combinator-he ultimately sold that business as well.ĬSC, which Yoshimura founded in 2016, is a little different. Yoshimura’s background is building e-commerce tools-in the early 2000s, he quit high school to create an online marketplace for unlocked cell phones. Justin Yoshimura Courtesy of CSC GenerationĪt the center of the drama was the founder, chairman and CEO of CSC Generation, a 32-year-old entrepreneur from Southern California named Justin Yoshimura. A furniture M&A expert put it to me bluntly: “This is not really the way that these people do these things.” It’s hard to overstate how unusual all of this was in a cloistered, old-school industry where deals can close with a handshake on a golf course. On October 11, CSC issued a press release saying that earlier outreach to the board had stalled out, and that it wanted to buy the company for just under $200 million-a 27 percent premium on the stock price. Only a month later, CSC made another play, this time for Virginia-based furniture brand Bassett. By making an all-cash offer at a price 22 percent higher than Flexsteel was currently trading on the stock market, CSC sent a tacit message to the manufacturer’s shareholders: If you want a premium on your stock without lifting a finger, you should let the board know.
In it, they stated that Flexsteel had failed to respond to an earlier offer, and that they were going public in order to “facilitate constructive discussions” with the board. CSC, by contrast, issued a press release. The way CSC went about it was not.Īcquisition deals often play out in private with a lot of backroom haggling. One company offering to buy another is normal.
The first came in September, when the news broke that a company called CSC Generation-the owner of, among other things, Sur La Table, Z Gallerie and One Kings Lane-had made an offer to purchase the Iowa furniture manufacturer Flexsteel for $20.80 a share. All the more reason why it was so striking when, last fall, two out-of-the-blue acquisition gambits made the home industry briefly feel like an episode of Succession. While hostile takeovers and Hail Mary mergers may be common enough in tech and finance, they do not regularly fill the pages of Furniture Today. The furniture industry-bless it-is not particularly known for high-stakes business drama.
0 kommentar(er)
