Hornby has agreed to promote the long-lasting slot automobile racing model Scalextric for £20 million in a transfer designed to strengthen its stability sheet and refocus the enterprise on its core manufacturers.
The Margate-based toy maker has struck a cope with family-owned funding automobile Purbeck Capital Companions, which can purchase Scalextric and its related mental property by means of a newly shaped holding firm, Scalextric Motorsports.
The transaction, which incorporates a mixture of upfront and deferred funds, will see Hornby use the proceeds to scale back debt and put money into its remaining portfolio, together with Airfix and its mannequin railway operations. Hornby is backed by Frasers Group founder Mike Ashley.
Scalextric was first launched in 1957 by inventor Fred Francis and rapidly grew to become a staple of British toy cabinets, permitting households to race miniature vehicles round electrical tracks at residence. Manufacturing was later moved to Hornby’s Margate manufacturing facility, the place the model grew to become synonymous with hands-on motorsport enjoyable for generations.
Purbeck Capital is led by Mark Brown, the previous chief govt of US spirits large Sazerac, which owns manufacturers equivalent to Southern Consolation and Fireball. The Scalextric acquisition marks Purbeck’s first deal.
Brown mentioned the agency was “honoured and thrilled” to amass such a long-standing British motorsport model, describing Scalextric as a enterprise that has introduced households collectively for practically seven a long time.
“As we glance to a long-term future, with Scalextric as a now family-owned firm, we’re energised by the chance to proceed bringing aggressive racing enjoyable to households, whereas increasing into new areas of motorsport,” he mentioned. He added that the model additionally has scope to advertise bodily play and hand-eye coordination at a time when many households are looking for to stability display screen time with real-world actions.
As a part of the settlement, Brown may even tackle a job supporting Hornby with its wider strategic transformation plans. The intention is to create a gaggle construction wherein particular person manufacturers can function extra independently and profitably.
The disposal displays Hornby’s ongoing efforts to stabilise its funds after a difficult interval for the standard toy sector, which has confronted rising enter prices, altering shopper habits and intense competitors from digital leisure.
By divesting Scalextric, Hornby is betting {that a} sharper deal with its core modelling manufacturers, mixed with a stronger stability sheet, will place the close to century-old enterprise for a extra sustainable future, whilst certainly one of its most recognisable names embarks on a brand new chapter below separate possession.
