- It has paid £400,000 for existing stock from CMC
- This stock will be sold directly to Hornby customers
- There will also be an additional consideration of around £200,000
Hornby has bought the intellectual property, brand and trade of Corgi Model Club from Blue 14, an investment vehicle majority-owned by entrepreneur Jim Lewcock.
The deal will value Corgi Model Club, which sells re-issued models of toy car and was set up as a third-party partnership with Hornby in 2021, at up to £600,000.
Model train maker Hornby told investors on Thursday it paid £400,000 for existing stock from CMC, which it will sell directly to Hornby customers in the future, pending an additional consideration of around £200,000.
The British-based model railways manufacturer purchase will be worth a total package of £600,000
The Kent-based firm said the deal will bring in £2million of revenue annually at a 15 per cent operating margin as well as 6,000 active customers.
CMC management are joining Hornby, with Guy Stainthorpe appointed as the brand managing director of Corgi.
CMC was set up in 2021 to sell contemporary editions of classic Corgi Models from the archives through a monthly subscription model.
Olly Raeburn, CEO of Hornby, said: ‘Bringing the Corgi Model Club subscription proposition into the Hornby business makes complete sense and we anticipate driving further growth both domestically and internationally over the coming months and years.
‘Furthermore, the immediate addition of over 6,000 die-hard Corgi collectors represents a great opportunity for creating additional value in the Corgi mother brand. This is an exciting development both for Corgi and for the Hornby business overall.’
Guy Stainthorpe, managing director of CMC, added: ‘Galvanising our long term partnership with Hornby in this way is a hugely positive development for CMC and provides us with a fantastic opportunity to further develop a successful and growing business. We look forward to joining Hornby and working alongside Olly and the team.’
In January, the firm said sales were 5 per cent higher from 1 October to 31 December compared to the same spell the previous year.
Cumulative group sales for the financial year-to-date were 6 per cent higher than the previous year.
The group said solid Black Friday sales contributed to 10 per cent revenue growth when compared to November the year before. Over 50 per cent of all Black Friday transactions came from first time purchasers.
Hornby shares were up 0.50 per cent to 33.67p in afternoon trading on Monday.
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