Samsonite, the world’s largest luggage company, has agreed to purchase Tumi for US$1.8 billion.
The acquisition of Tumi will allow Samsonite to enter the luxury market – a space the brand has never occupied before, having traditionally been focused on the mass market.
“We always wanted to have a play in this segment, but we have never been able to do it in a very credible way,” said Ramesh Tainwala, Samsonite’s chief executive, to The Washington Post.
Meanwhile, becoming part of a larger brand will allow Tumi to increase its scale and achieve operational efficiency. Speaking to the Post, David Schick, a retail analyst at Stifel, said: “What we see in the evolution of luxury is that brands understand they can only get so big.”
Samsonite has stated that it intends to expand the Tumi brand to international markets.
The company posted US$548 million in sales last year, with 68 per cent coming from North America, and Asia coming in a distant second (17 per cent).