Freeman Acquires Champion, Fern and Immersa in Blockbuster Deal

HIL ANDERSON, SENIOR EDITOR
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Dallas, TX – Freeman announced today it has acquired Wheelhouse Solutions and its subsidiaries – Champion Exposition Services, George Fern Company and Immersa Marketing – in a deal that will fold Champion into the Freeman brand while leaving Immersa and Fern as standalone subsidiaries of Freeman. Terms of the deal were not revealed.

The sale by the private equity owners of Wheelhouse Solutions was not unexpected and adds some major new events to Freeman’s portfolio.  Champion, which provides event marketing and booth design services, was the official service contractor for three Trade Show Executive (TSE) Gold 100 shows in 2009. By comparison, Freeman was lead contractor on 57 Gold 100 events. Global Experience Specialists (GES) had 27.

Robert Priest-Heck, CEO of Wheelhouse, told TSE he will join Freeman as executive vice president, reporting to CEO Joseph Popolo. Aaron Bludworth will remain COO of Fern, reporting to Freeman COO Albert Chew.

“We have begun reaching out to our customers to explain the changes to them,” Popolo told TSE. “We’ve had some great feedback. It has been very positive.”

Trade show organizers and other customers, particularly in the association market, will benefit from a wider choice of products and services and from the one-stop planning that makes life easier for show managers and exhibitors, Popolo said.

While there are differences in technology offerings and business strategies, Freeman and the Wheelhouse companies are fairly similar in their services and corporate cultures. “Over the years, Freeman has been in the market to acquire companies that improve the service to our customers,” Popolo said. “We ran this deal through the filters we have … and it hit the mark and we negotiated a satisfactory deal.”

While the financial information for the transaction was not revealed, it did not require any new stock issues, Popolo said.

Looking Forward

Popolo said joining forces with Champion opens the door for further growth in the corporate event market. At the same time, he said, Freeman is looking at expanding its international presence.  The company is opening a London office this year.

In the U.S., the acquisition will give Freeman a stronger presence in the association market. Immersa’s expertise in event marketing is considered a promising asset in serving non-profit organizations that have likely seen their budgets pinched by the recession.

Immersa and its two sister firms will benefit from a deeper “bench” of personnel, infrastructure and technology in virtually every major trade show city in the U.S.

“When the opportunity to join Freeman arose, we felt like it was an incredible opportunity for our customers,” said Priest-Heck.

“We’re also keeping the lion’s share of our staff,” Priest-Heck told TSE. “They will be integrated into Freeman.”

Bigger and Better

The addition of the Wheelhouse assets bolsters Freeman’s already formidable profile. Freeman services more than 3,000 exhibitions annually and another 10,000 corporate and special events. Its revenues for the 2010 fiscal year were more than $1.14 billion.

Dallas-based Freeman has 3,900 full-time and 29,000 part-time employees operating in 40 U.S. cities. Freeman’s Employee Stock Ownership Plan, which was launched 30 years ago, holds 38% of the company’s shares. Wheelhouse’s combined companies total 900 workers and about 1,500 events.

“Whether it is technology tools or marketing solutions that help customers think about how to manage their entire communities, both Wheelhouse and Freeman are going down that same path,” Priest-Heck said. “We saw so many synergies for the customer.”

Stars in Alignment

Priest-Heck said Wheelhouse was not in any financial difficulties when it agreed to the acquisition. The company made it through the recession and had a very successful month in May.

Popolo told TSE the equity ownership of Wheelhouse was at a point where it needed to refinance the company and apparently decided amid a “market check” that a sale was an attractive option.

The improving prospects for the trade show industry also made it an opportune time to pull the trigger. “Our ownership bought the business five years ago, which is a pretty traditional investment horizon for a private equity firm,” Priest-Heck said.

“There is still a lot of growth in the market because we have not yet seen a full recovery,” Priest-Heck said. “When things are heading in a positive direction, it is a good time to look at new opportunities.”

Reach Joseph Popolo at (214) 445-1000 or joe.popolo@freemanco.com; Robert Priest-Heck at (415) 230-3000 or bph@wheelhousesolutions.com