KEE paintball shake up – UPDATED
March 9, 2010 in Industry News, Rumor Reports
Rumors are flying around the paintball community today that a major change has taken place at KEE Action Sports. As the company recently picked up several “mega-brands” from the Jarden Corporation, we knew that it was only a matter of time before rumors of major adjustments began to leak. Read on for the latest paintball gossip concerning industry giant KEE Action Sports.
Updated with information from KEE:
Effective 3/9/10, John Robinson has replaced George Eurick and has been appointed the CEO of KEE Action Sports.
According to VFTD, an “executive” shake up is currently underway at paintball’s largest company, KEE Action Sports. The recent buyout of Jarden Corporation’s paintball division by KEE Action Sports meant that KEE picked up several notable brands including Brass Eagle, Viewloader and JT Sports. As is typical in most acquisitions, the new parent company typically works overtime to fit the newly acquired businesses and its employees into the bigger picture.
According to Pro Paintball inside sources, John Robinson will replace George Eurick as the companies new president. John Robinson has a background in mass merchandising and sources tell us that John led JT Sports push into big box retailers, most notably Wal-mart and Dicks Sporting Goods in the USA. Pro Paintball insiders suggest the change must have come from the top, in this case KEE Action Sports corporate parent & investing group Angelo-Gordon. We expect to hear of a few more internal changes taking place at KEE Action Sports in the weeks ahead. In the mean time, read the original tip at VFTD.
Be sure to stay tuned to Pro Paintball for the latest paintball news and gossip.
*** said on March 9, 2010
Sounds like it could be good or bad for the company. If all goes well, then we’ll see this acquisition prove to strengthen KEE’s ability to live on due to little competition. If not, then we could see the rest of KEE sold to Dick’s and Wal-Mart. Then RPS becomes Monsterball, Halo becomes Viewloader, and BT becomes JT. I just don’t see how the lower of the two companies gets to choose the head of affairs for the merger. Then again, that’s just my two cents, and I’m no businessman.
frustrated said on March 10, 2010
I’d have to agree – this is strange to say the least. I’m guessing (and it truly is just a guess) that JT was weak and that is why KEE was able to purchase them. JT made a big push into the Big Box store and I believe it is that push that made them weak. Not only did the push make them weak by tying up their paint machines making low profit paint it also served to drive profits down for paintball retail stores and fields. No Fields = No Need for Paintballs and Equipment = No need for Paintball Manufactures. A bigger push into the Big Box stores is a recipe for disaster in my opinion.
Justin said on March 10, 2010
I totally agree with you guys, this is a very interesting development that could have a major impact.
In response to “frustrated”;
While JT exerted resources to chase after mass merchants like Walmart and Dicks sporting goods they did so with the full intention of reaching & developing a new market for paintball. The “big picture market” involved people that may not have had the exposure to paintball and thus not have shopped in local stores and played at local fields. Entry level players. Those same entry level players may have eventually demanded higher quality equipment and could have very easily become clients to the local paintball stores. New players = new clients = new money into the sport. This is good.
JT, in their mass market push, left a big void for their competitors to fill. This vacancy enabled smaller companies to develop and focus on servicing local paintball shops. This is also good.
When these companies grow to be as large as they are, its only natural for them to look into developing new markets for their products.
On a side note, we need to move paintball away from the hunting section and closer to the bikes and baseball bats. While I totally agree with the argument that shooting is a sport, many parents and their kids tend to by-pass the hunting / fishing department after getting their other sports gear, and thus we miss out on potential customers.
Reaper said on March 10, 2010
Big box is bad for our industry in the sense that it does kill companies and smaller local shops. It’s good in the sense that it UNFORTUNATELY appeals to a great deal of cheap S.O.B.s that would rather save a nickel. Still, some business from those customers is better than none. It would be nice to find a balance between the two, but the big box concept is too greedy for that to ever work.
However, you can’t say that because JT was sold at Walmart that their products sucked. JT made some of the nicest pants in the industry, and I don’t think many people would argue the quality of the Flex Series of Masks, especially the Proflex and Proflex Revolution. For $70 those things are better than any mask on the market.
KEE said on March 10, 2010
KEE Action Sports daily business will continue as normal.
Effective 3/9/10, John Robinson has replaced George Eurick and has been appointed the CEO of KEE Action Sports.
mark said on March 10, 2010
Wow, Dye just scored big.
*** said on March 10, 2010
To frustrated and Justin:
Hopefully, this can still turn out well, though. While the new president is a JT man, KEE still has deep roots in the higher-end spectrum of the market as well. They’re not necessarily going to try to sell out to Big Box; while the possibility is out there, it’s better to control the industry from the middle and the bottom than from just the bottom.
Now that KEE owns JT, though, they do control most of the beginner market. JT makes some cheap markers, as does PMI and Diablo. They are the sole distributor of Kingman in the U.S. (a.k.a. they own Spyder). BT has been growing in the newb field. About all that’s left out there now is Tippmann, and arguably Smart Parts.
This brings me to a side note before my next point. While I acknowledge that JT is a better buy as a whole, Smart Parts has essentially gone under, and the corpse doesn’t seem like it’ll start kicking again anytime soon. With their grasp over the newb market, they would have made an excellent addition to KEE’s laundry list of subsidiaries. However, I can also realize a few reasons why KEE passed up the opportunity. First, JT is a HUGE company, and surely cost a pretty penny. Second, Smart Parts, though flatlining, still owns DLX, which is doing fairly well. Finally, Dynasty got off of the Ions and Shockers for Luxes last year, got off Luxes for Egos this year, and probably doesn’t want to go back. With KEE as their main sponsor, and with their (now flaundering, but that’s beside the point) reputation, they mark huge advertisement potential for KEE, and the company wouldn’t want to risk shoving them away.
For my next point, KEE now also owns, as Reaper pointed out, high-end clothing lines to add to Empire and Invert, as well as more affordable options. The same could be said for masks. KEE is getting a hold of the middle-end of the market as well, and is slowly moving to take its place as the manufacturing authority of the sport (if you don’t already believe it to be). If they were to take Dangerous Power, then they would only seriously be competing with Proto and ETek for mid-grade markers.
Eventually, even these would be capitulated. Once KEE had the money, Dye and Planet Eclipse would succumb to the beast as well, and KEE would be able to produce everything at higher quality with the massive mixing of masterminds and…dang, no m-word for inventors. Anyway, at that point, KEE would basically own paintball. The rest of the companies would just be loose ends to tie up.
Just my two cents. Sorry, was this more text than the rest of the page? Guess I got carried away.
wow said on March 10, 2010
You almost sound like you know what you’re talking about.
In the grand scheme of all of KEE’s sales, even Dynasty doesn’t matter.
Smart Parts is dead and DLX is a niche provider of very high end equipment that only addresses a tiny fraction of the paintball market.
KEE’s biggest problem right now is that they have too many brands and need to kill a few.
*** said on March 12, 2010
@wow
I know that Dynasty’s not their main focus. Trust me, I agree with you on part of it; the reasons that I provided for KEE not buying Smart Parts were just what I could pick up to be possible excuses not to buy the company.
However, your opinion on the company itself doesn’t reflect the actual potential of the purchase. You say that Smart Parts is dead; with a little money for its revival (and KEE’s got plenty from its size) could get it back on its feet. Plenty of people use Smart Parts markers; I ref at a field in Jersey, and from all of the games I’ve reffed and played at, I noticed that in the woods and in scenarios (which make up most of the paintball market), Smart Parts is the dominant electropneumatic marker production company out there, just ahead of Invert and BT (notice a pattern here?). Luxe is just a bonus acquisition at that point; it may have some sales, but the meat of the purchase is in the entry-level and woods market. If KEE can take over the beginner’s market, then it holds an enormous profit once the economy picks back up and the sport gets new players.
Now, my biggest question is how you come to the conclusion that the company needs to drop its subsidiaries. While it may not prove to be initially beneficial in this market, once the economy turns upward, those companies will increase the revenue of the conglomerate exponentially. Look at history; Carnegie, Rockefeller, and Gates all got rich off of their ingenuity paired with their (near-)monopolies established in their markets. While there will always be new companies participating in the paintball market that have not been put under the control of larger conglomerates, KEE’s dominance over multiple companies will put it in a better position to use its engineering capability (Simon Stevens) for profit.
Scott said on March 10, 2010
When thinking about Kee selling out to big box. Kee is owned by an investment group. While there are exceptions, most investment groups spend money on a company (or group of companies) in order to turn that purchase into a sale for profit at a later date. Consolidate companies in a down market. Wait for the market to pop a little and sell for a nice profit.
frustrated said on March 11, 2010
Don’t kid yourselves – KEE didn’t purchase JT for the Goggle Market, Loader Market, Marker Market or Clothing Market. In my opinion KEE purchased JT for their paintball manufacturing abilities – same reason they bought XO. They always run into shortages during the year where their machines can’t keep up with demand. All the other items on the list are gravy. I love the Flex, so I hope that they stick around. I don’t care for their loaders (JT’s that is) and no KEE retailer needs another brand of clothing to carry – not in the Brick and Mortar anyway.
Maybe the JT Plant will be mostly dedicated to making cheap paint for the Big Box stores. No matter – I’ll simply ban every brand that Walmart/Dicks/Sports Authority/etc.. carries from being allowed at my field. If you can’t purchase the same brand/same package at a Paintball Specific store then you can’t use it at my field.
been there said on March 11, 2010
all those in this thread that beleive big box is bad for paintball are delusional. Where do new players come from?
how can they trade up if they dont start somewhere? Loosing any big box customers is bad for everyone.
KEE will not keep the JT plant-dont believe this was included in the deal. Paintball right now is all about reducing capacity so the companies in the industry can make money. KEE has enough capacity to take on what is left of JT’s business-which is down a lot when they lost the Walmart business. Are you going to ban Procaps? KEE (as PMI) has been in big box for years-did you “ban” it then?