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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (Date of earliest event reported): October 21, 1999
STEINWAY MUSICAL INSTRUMENTS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 001-11911 35-1910745
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
800 SOUTH STREET, SUITE 425
WALTHAM, MASSACHUSETTS 02453-1472
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (781) 894-9770
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Item 5. OTHER EVENTS
On October 21, 1999 Steinway Inc., an indirect wholly owned subsidiary
of Steinway Musical Instruments, Inc., retained IMG Licensing to represent
the STEINWAY & SONS trademark for the development of a global licensing
initiative. See press release attached as Exhibit 99.1 for additional
details.
On November 1, 1999 Boston Piano Company, an indirect wholly owned
subsidiary of Steinway Musical Instruments, Inc., and Young Chang Co., Ltd.
of Korea jointly announced an agreement under which Young Chang will
manufacture a new line of grand and upright pianos designed by Steinway. See
press release attached as Exhibit 99.2 for additional details.
On November 10, 1999 Steinway, Inc. acquired 100% of the outstanding
stock of The O.S. Kelly Corporation ("Kelly") from a small group of private
investors for $2,800,000 in cash. Bank debt assumed at the closing, net of
cash on hand, approximated $93,000. The acquisition included the following
subsidiaries of Kelly: The O.S. Kelly Company and The O.S. Kelly Company of
Arkansas, Inc. Kelly has its manufacturing facilities in Springfield, Ohio
and employs approximately 50 skilled workers. For its fiscal year ending
October 31, 1999, Kelly's earnings before interest, depreciation and taxes,
adjusted for certain non-continuing expenses, approximated $750,000. See
press release attached as Exhibit 99.3 for additional details.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
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<CAPTION>
Number Description
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<S> <C>
99.1 Press Release issued by the Company on October 21, 1999 announcing
the IMG Licensing Agreement
99.2 Press Release issued by the Company on November 1, 1999 announcing
the Boston Piano and Young Chang Agreement
99.3 Press Release issued by the Company on November 3, 1999 announcing
the acquisition of The O.S. Kelly Corporation
</TABLE>
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
STEINWAY MUSICAL INSTRUMENTS, INC.
/s/ Dana D. Messina
-------------------------------------------
Dana D. Messina
Director, President and Chief Executive Officer
Date: December 7, 1999
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EXHIBIT 99.1
For Immediate Release:
STEINWAY RETAINS IMG LICENSING
FOR WORLDWIDE CELEBRATION OF FIRST 150 YEARS
NEW YORK, October 21, 1999 - STEINWAY & SONS, considered to be the finest
producer of pianos in the world, has retained IMG on an exclusive worldwide
basis to represent the STEINWAY & SONS trademark for the development of a
global licensing initiative, the first such activity in its long history.
Steinway will celebrate its 150th anniversary in 2003, and according to Frank
Mazurco, Executive Vice President of STEINWAY & SONS, and Jeffrey Ceppos,
IMG's VP, Director of Fashion and Trademark Licensing, this important
milestone triggered Steinway's direction toward brand extensions.
Steinway and IMG believe now is the ideal time to leverage the STEINWAY &
SONS trademark, a mark with superior brand recognition and a reputation for
unparalleled excellence in design, craftsmanship, innovation, sound and, most
of all, quality, into a fully developed luxury brand. IMG plans to develop
and build the Steinway Licensing Program in product categories that build
directly on the brand's strengths. Ceppos adds, "There are very, very few
brands worldwide that represent so purely and thoroughly the standards of
excellence and craftsmanship that Steinway does."
"IMG immediately saw the opportunities that exist for Steinway," says
Mazurco. "The instrument by which all other piano makers are judged is now
represented by the company that sets the standards in marketing and
licensing," he adds.
Targeted categories for Steinway's brand expansion include technologically
advanced audio equipment, home furnishings and care products, as well as
lifestyle luxury products and collectibles. A Steinway lifestyle magazine,
classical music and jazz record labels, as well as digital music samplings
are also possibilities.
Steinway will soon celebrate a historic 150th anniversary which will be
supported by a number of special events and concerts. Ceppos states, "Well
before 2003, we hope to have a strong family of licensees that will want to
participate in this unique opportunity to celebrate a world renowned icon."
Since its beginning, STEINWAY & SONS' superior designs, craftsmanship,
innovation and sounds have represented the highest quality in sound quality
worldwide. Today over 95% of piano soloists performing with major orchestras
around the world choose to perform on Steinway pianos exclusively.
STEINWAY & SONS is a wholly owned subsidiary of Steinway Musical Instruments,
Inc. (NYSE: LVB), one of the world's leading manufacturers of musical
instruments. In addition to STEINWAY & SONS pianos, the Company produces a
complete line of orchestral and band instruments through its Selmer division,
including such notable products as Selmer saxophones, Bach trumpets and
Ludwig drums. IMG Licensing is part of the Mark McCormack Group of
Companies, founded by Mr. McCormack in the early 1960s. The company is the
world's premier sports management and marketing agency.
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Contact: Steinway & Sons Hamburg Steinway & Sons New York
Mrs. Sabine Hopermann Mr. Leo Spellman
Telephone: 040-85391-176 Telephone: 718-721-2600
Fax: 040-85391-199 Fax: 718-932-4332
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EXHIBIT 99.2
BOSTON PIANO AND YOUNG CHANG CO.
JOINTLY ANNOUNCE AGREEMENT
TO DESIGN AND BUILD NEW PIANO LINE
New York City, Nov. 1, 1999 - New York based Boston Piano Company, a
subsidiary of Steinway Musical Instruments, Inc., and Young Chang Co., Ltd.
of Inchon, Korea jointly announced the signing of an Agreement under which
Young Chang will manufacture a new line of grand and upright pianos designed
by Steinway. This new piano line will join Steinway Musical Instruments'
other two piano brands: Steinway & Sons, the world's premier piano; and the
mid-priced Boston line designed by Steinway and manufactured in Japan.
"Consumer demand for Steinway-designed pianos is extremely strong," observed
Bruce Stevens, president of Steinway & Sons, "as evidenced by the current
back order position for Steinway & Sons brand pianos and the tremendous
worldwide sales growth of the Boston line since its introduction in 1992. We
firmly believe that now is the ideal time to produce a third piano line
offering an even larger number of young consumers an instrument of superior
quality at an affordable price."
"We are very pleased that the Boston Piano Co. has selected Young Chang to
produce its newest line of pianos" stated Jay Kim, managing director of Young
Chang Co., Ltd. "This further validates that Young Chang has both the
technology and craftsmanship to produce fine quality musical instruments."
The first models of the new line will be unveiled formally in early 2001 at
the National Association of Music Merchants' annual convention and at the
Frankfurt Musik Messe Show in Germany. Initially, consumers will be offered
at least two grand piano models and two upright sizes in a variety of
furniture styles and finishes. The new line will be represented exclusively
through Steinway Halls, Steinway Piano Galleries and select Steinway/Boston
dealerships in designated markets around the world. Specific pricing of these
pianos has not been finalized at this time, although Stevens stated that this
third line will be priced below the Boston piano.
Considered by most music experts to be the world's finest, Steinway & Sons
pianos are created from 12,000 components and require a year to handcraft
and assemble. They are sold worldwide by an exclusive network of authorized
dealers. Boston pianos combine musical scale designs and features by
Steinway with state-of-the-art manufacturing processes and are also sold
worldwide by Steinway dealers.
Steinway Musical Instruments, Inc. (NYSE:LVB) is one of the world's leading
manufacturers of musical instruments. In addition to Steinway & Sons and
Boston pianos, the company produces a complete line of orchestral and band
instruments through its Selmer division, including such notable products as
Selmer saxophones, Bach trumpets and Ludwig drums.
Young Chang Co., Ltd. is one of the world's largest piano makers with
corporate headquarters and main piano manufacturing operations in Inchon,
Korea. Young Chang pianos are sold in more than 45 countries throughout the
world. The company, which has won numerous awards for its manufacturing
excellence, manufactures several brands of pianos, including Bergmann, Young
Chang and the Pramberger Signature Series. In 1990, the company acquired
Kurzweil
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Music Systems of Boston, MA, creator of the world's leading synthesizer and
digital piano systems.
For more information, contact Leo Spellman, Steinway & Sons, at (718)
721-2600 X 3116 or Jeff Allen, Young Chang America, at (253) 589-3200 X 127.
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EXHIBIT 99.3
For Immediate Release:
STEINWAY ACQUIRES LARGEST PIANO PLATE
MANUFACTURER IN THE U.S.
WALTHAM, MA - November 3, 1999 - Steinway Musical Instruments, Inc.
(NYSE:LVB) today announced that it has signed an agreement to acquire O.S.
Kelly, the largest manufacturer of piano plates in the U.S. The purchase
price, including the assumption of debt, will be approximately $3.2 million
dollars. O.S. Kelly, located in Springfield, Ohio, is expected to generate
annual revenue of over five million dollars. Mr. Robert Seeley, President
and CEO of O.S. Kelly will continue in his position after the acquisition.
Commenting on the acquisition, Dana D. Messina, Chief Executive Officer
stated, "This transaction furthers our strategy of acquiring businesses that
produce our products' critical components. This addition will further
enhance our overall manufacturing process and product quality. We anticipate
a smooth and successful assimilation of O.S. Kelly into our piano business."
Bruce A. Stevens, President of Steinway & Sons, added, "We are extremely
excited about this opportunity. O.S. Kelly has produced high quality piano
plates since 1890. Steinway & Sons and virtually every other piano
manufacturer that considers quality a priority have been long term O.S. Kelly
customers. Since Steinway accounts for more than half of O.S. Kelly's
production it was logical to bring it in house."
"Everyone here at O.S. Kelly is thrilled to become part of the greatest
piano company in the world," noted Robert Seeley. "This event is one of the
most significant milestones in the long history of our company."
Steinway Musical Instruments, Inc. through its Steinway and Selmer
subsidiaries is one of the world's leading manufacturers of musical
instruments. Its notable products include Steinway pianos, Selmer
saxophones, Bach trumpets and Ludwig drums. Additional information can be
obtained by visiting our web site: www.steinwaymusical.com.
Contacts: Steinway Musical Instruments, Inc. Steinway & Sons
Dennis M. Hanson Leo Spellman
Phone: (781) 894-9770 Phone: (718) 721-2600 X 3116
[email protected] [email protected]
