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SBD/August 19, 2013/FinancePrint All
Louisville Slugger parent company Hillerich & Bradsby said that it obtained a roughly $40M credit facility "from Wells Fargo on Aug. 2 after running into problems with its existing lender," according to Emily Glazer of the WALL STREET JOURNAL. The company is "trying to rebound from a series of missteps in recent years including a costly bat recall." Hillerich & Bradsby "went shopping for a new bank this spring when PNC Financial Services Group Inc., its lender for decades, started playing hardball." Hillerich & Bradsby COO & CFO Lawrence Writer said that the new cash from Wells Fargo "will be used for day-to-day operations," and also "may be used for acquisitions and other future growth projects." Sources said that the company has annual sales of about $100M "across its products." Glazer notes Louisville Slugger is MLB's official bat maker and "has contracts with more than half the league's hitters." But the company "determined it was becoming less relevant and needed to be more aggressive to keep up with its competitors." CEO John Hillerich IV said that the company was "too slow to adapt to the changing world." He added that around '11, when Louisville Slugger began losing market share, "internal processes were broken." Hillerich "brought in operational-turnaround firm AlixPartners" and "recruited former Nike sales executives to help sell its various products more harmoniously." The company also "hired a Nike veteran to improve its supply chain." Hillerich & Bradsby now is "refocused on fixing its manufacturing problems and regaining market share, as well as relevance." For the first time, joint product lines are "coming out with a dedicated marketing push, first in September for softball and later in November for baseball." A new, "more durable bat made in China -- but with a new protocol for how it is tested -- will be available by early September" (WALL STREET JOURNAL, 8/19).