Breville to acquire Lelit

Gagaryn is right re VW/Fiat. My bad. Never a good idea to rely on my memeory. Regardless of who bought who, the point remains that smart companies acquire other companies and tend to grow those brands as separate entities rather than absorb them. IMHO (and with full respect for others who beg to differ) that’s the relevance of the car analogy. Here’s VW acquisitions with these brands and what they stand for typically having been made stronger post acquisition:

• Audi

• Bugatti

• Porsche

• SEAT

• Lamborghini

• Skoda

• MAN

• Scania

• Ducati

My point being that a smart aquirer makes the aquired brand stronger, not weaker.

Your honour, I rest my case.

(As always, time will tell)

Mark-drinks-coffee Not sure the argument that big = lack of innovation quite holds true, see Apple and Tesla (or the three companies you already mentioned).

Where did I say big companies lack innovation? I said that the reality in which whenever something good grows, anywhere and in any field, it is likely to be gobbled up by bigger money, so that it can make even more money, is a sad thing. I would have preferred to see Lelit continue with what they were doing, as they were doing it, rather than them becoming a part of a huge international appliance conglomerate. In my view, the most likely result of this acquisition is that Breville will gain while everyone else will lose.

DavecUK Doram I suspect the prices might rise as well….

As above…

Mark-drinks-coffee Apart from the previous owners/ shareholders who I presume pocket the £100m sale price?

I obviously have no idea what the motivations were for the founders/ owners of Lelit but a number of entrepreneurs/ start ups have the explicit aim of building a company to then be acquired by someone else. They often have this exit strategy from day 1.

Yes, of course some people’s strategy is to make an exit, and others can’t resist the temptation. And obviously Lelit’s owners/shareholders will make money as well. That isn’t the point I was trying to make. The point is that the reality today is that there is only room for very few players, who are so strong that no one else can compete (and if anything good tries - they will buy it).

Yes, buying things on amazon is convenient and the prices usually a little cheaper, but this comes at a huge cost to everyone while Jeff Bezos becomes richer and stronger than most countries. As a coffee hobbyist, I don’t see any way to look at Breville buying Lelit as a positive thing.

I am not sure this is the best place for this discussion, and it seems that we will only go round in circles if we continue. I will try to stop. :)

Mark-drinks-coffee

I work in the tech industry and you’re completely correct.

I’ve also been part of the ‘acquired’ company on more than one occasion and I can say with confidence that it very much sucks for everyone who isn’t a shareholder.

This may be a completely useless analogy as we’re talking about coffee machines and not tech companies, but usually the purpose of acquisition is to either buy into a market the parent company isn’t yet in, or to incorporate their products into the parent product.

Again though I hope they just continue to operate as their own entity with the logistic/supply chain support of Breville.

Mark-drinks-coffee Yup I agree, but it was nice to voice (and listen to) different opinions without us calling each other names!

It was nice. We all seem to be able to do this on Coffeetime, realise others may have different opinions to us and be respectful with our own opinions…it’s what makes it such a great forum.

Whatever happens with Lelit, there is a wealth of knowledge on here to enable us to keep our machines in good order for decades. I must remember to get a copy of the V3 Bianca firmware. I suppose I could read it back off my own LCC and save it. All of the components are industry standard, or replaceable with Industry standard components.

A lot of companies have been acquired by corporates over the years…Isomac, Expobar (now Crem), Rocket….it’s just the way of the world. ACS and ECM are still owner companies, but there are very few new entrants into what is a Tough market..ACS was probably the last new proper manufacturer to enter the market.