Pixiq

 Leica Camera had a great 2010/2011 with sales of nearly 250 million Euros ($350M US) almost twice that of the previous year. This increase was due largely to the robust sales of Leica M and Leica S series cameras. It’s a far cry from the 1970s and 1980s when the company almost shut its doors and it make Leica a desirable purchase for any investor with money to move. Headquartered in Solms, Germany, with about 1,150 employees, it is one of the standard brands of German excellence. 

Today October 19, 2011 it was announced that the Blackstone Group (NYSE: BX) has agreed to a strategic partnership with ACM Projektentwicklung GmbH, the owner of the Leica brand and will acquire, indirectly through a holding company, a 44% minority stake in Leica Camera AG (“Leica”). Leica sees this as an opportunity to support their  international growth plans. ACM and Blackstone have agreed that the value of the transaction, which is subject to regulatory approval, will not be disclosed. 

Dr. Andreas Kaufmann, Chairman of the Supervisory Board of Leica said that “With Blackstone we have gained an experienced and internationally established strategic partner, which also understands and appreciates the established brand philosophy and business model of Leica. Following the successful turnaround of the business and record sales last year, we are now focused on the continued development of the brand, its products and our growth plans into new markets such as Asia, South America and the Middle East.” 

Axel Herberg, Blackstone Senior Managing Director, added that “Leica is deeply rooted in Germany’s history and we would like to help grow the business in a manner that is true to this heritage, ensuring that the entrepreneurial spirit that makes Leica unique is preserved.”

 What this means for photographers around the world is yet to be seen but based on the success of their top-of-the-line cameras there is little likelihood that they will pursue or make products for the lower end consumer and photo enthusiast consumer. They tried that once with the Leica CL and Leica M5 and paid dearly for it, crashing sales of the standard bearer the M4. 

Like many other luxury products, Leica has done well in a stagnant economy and particularly with sales to the newly rich Asian markets like China and India. This investment will provide Leica the cash to follow their plans to strongly expand into these markets. 

The transaction is expected to be completed by the end of the Q4/2011.