Hatton's buys MB Klein in the US

[johnd]

Strange, yet another British business to buy an American one and then decide to close down or use another word for it. 🤔

[melmerby]

Weird

Hattons looking for presence in US

Find a warehouse

Buy M B Klein (a similar type of business)

M B Klein goes internet only and moves to new location  (Hatton's Warehouse?)

Hatton's to close (maybe relocating core business to US?)

M B Klein closed

 

Unless a new Hattons arises from the ashes in the US using MB Klein's assets.

I'm confused.

[Nova Scotian]

Everyone assuming Hattons paid for the acquisition. I have no information to the contrary, but most model shops aren't getting picked up - the owner retires and it shuts as the return on investment isn't there. 

 

Quite possible they picked it up for a song hoping to use it to shore up UK outline sales in US, while keeping the business ticking over with US retailing. For whatever reason (maybe same trends there as here), that didn't work out.

 

I valued a business for acquisition once - owner wanted 250k, my valuation was 25k. Didn't even negotiate, we would never have found a good place. Took a year to sell, sold at 100k, new owner lost their shirt as they tried to run it alongside a day job rather than taking over management themselves - and had got themselves into a few sticky corners they should have been smarter about too. Felt bad for them.

[1andrew1]

2 hours ago, melmerby said:

Weird

Hattons looking for presence in US

Find a warehouse

Buy M B Klein (a similar type of business)

M B Klein goes internet only and moves to new location  (Hatton's Warehouse?)

Hatton's to close (maybe relocating core business to US?)

M B Klein closed

 

Unless a new Hattons arises from the ashes in the US using MB Klein's assets.

I'm confused.

MB Klein was web only before Hatton's purchased it. I can't see Hatton's restarting under its own name in the US as it is relatively unknown there. 

 

 

[melmerby]

39 minutes ago, 1andrew1 said:

MB Klein was web only before Hatton's purchased it. I can't see Hatton's restarting under its own name in the US as it is relatively unknown there. 

 

 

 

Hattons had been in the US for a while, with a place in Fremont:

Hattons North America LLC 1230 Dunbar St, Fremont, Nebraska  68025, USA

 

 

It has now closed.

 

 

Edited January 25 by melmerby

[andyman7]

It is possible that the realisation that the MB Klein acquisition was not going to provide the growth needed was one of the reasons that Hattons itself decided to wind down. The sequence of the announcements does not necessarily reflect the sequence of decision making.

[GenericRMWebUsername]

After scanning some of the American forums, there is a fair amount of ire about this. I think MB Klein should have followed the precedent Hattons set with the shutdown of their British website. Giving an FAQ, an explanation, and a sincere goodbye for a brand that had existed for 111 years seems to be the appropriate approach. Instead, the message is a little curt if I'm being honest. That's generating animosity where none had to have existed. The Hattons website shutdown is a masterclass in customer loyalty and goodwill. People came away broadly sympathetic to Hattons and their team. By contrast, the MB Klein shutdown is creating anger. 

 

Just my two cents. 

[JSpencer]

The stuff I'm seeing on US social media.... You need to take what they say, not with  a pinch of salt but several palettes with sacks full of salt. The thing is, anyone can write and say anything and I've seen stuff from people claiming to be staff or are in close contact with staff. And it is one heck of a story, that is getting bigger by the day!

 

In a nutshell, you would need a lot of diligence to see this one coming (I suspect some of the stuff claimed over there would be out right illegal over here if it is true - and that's a a BIG IF). But the crux of the "claim" is that there is a 7 figure tax bill to be paid (by who is another question, and the wrangling's of how it got there, who did what etc of it all should make a great film in Hollywood...). 

A lot of this is like Trump's "I know someone who said...".  And it is looking like a huge conspiracy theory that only the US knows how best serve! It will soon be up there with Flat Earth and Creationist Science. 

 

The whole story looks like being on a big ship that is about to blow up. And the best anyone can hope to do, is to get off it as fast as you can!

[Colin_McLeod]

When I googled "Hatton Klein" it led me to a firm of solicitors. lol 😀

 

 

 

[Ravel]

Acquisition to closure in roughly 4 months? Surely sufficient due diligence would have to have been done, this could have been going on for 12+ months if the process is anything like the UK. 
 

 

A very strange set of circumstances for sure. 

[1andrew1]

Hattons is no big corporate and is 79% owned by one person, Richard Davies. So there wouldn't be the level of due diligence you'd see in the corporate world where the shareholders are distinct from management.

[melmerby]

This article mentions the association with Heartland Hobbies, close by where Hattons USA presence was:

https://fremonttribune.com/uk-based-hattons-model-railways-looks-to-expand-with-fremont-distribution-center/article_3f5e3c71-3335-599d-911e-621f3048aff7.html

 

EDIT

Hattons registered their US offshoot on Nov 8th 2021

 

Note the fourth filing:

https://www.nebraska.gov/sos/corp/corpsearch.cgi?acct-number=2111299028

Edited January 27 by melmerby

[Gridiron]

8 hours ago, melmerby said:

This article mentions the association with Heartland Hobbies, close by where Hattons USA presence was:

https://fremonttribune.com/uk-based-hattons-model-railways-looks-to-expand-with-fremont-distribution-center/article_3f5e3c71-3335-599d-911e-621f3048aff7.html

 

EDIT

Hattons registered their US offshoot on Nov 8th 2021

 

Note the fourth filing:

https://www.nebraska.gov/sos/corp/corpsearch.cgi?acct-number=2111299028

 

That article in the Freemont Tribune is dated 26 Feb 2022 so assuming the article  is correct the intention seems to have be  to start trading later in 2022 from Nebraska and hence Hattons North America LLC establishment in the previous November. It can therefore only be assumed that  they must have become aware of MB Klein business and started due diligence . I was not able to trace recent public records for Heartland Hobbies in Nebraska so it could be the entity is controlled elsewhere in the USA>

 

However, something must have happened to change the business model or ownership as  Hattons North America Inc filed for closure in June 2023 followed by the announcement of the purchase of MB Klein in November 2023. I wonder therefore if the original plan had been to establish a US entity as a joint venture with Heartland Hobbies but buying MB Klein with it's warehouse etc already trading looked to be a better business prospect. 

 

I have also not been able to discover from US public records the beneficial owner of the MB Klein, except that is appears the person appointed as having Power of Attorney, and thus the legal entity, appears to be an employee of Morgan Stanley, which might suggest the ownership is overseas. Of course this does not explain the subsequent decision to close both the US and UK entities which given the US time line is very strange indeed.