Comparing Leica and Kodak is an interesting exercise. While they’re not the same by any stretch of the imagination, both rode the wave of photography throughout the 20th century and, come the age of digital imaging, both stumbled. Kodak is starting to leverage its IP and Leica has found a new prosperity in its high-end digitals.
But Kodak is still in its crisis period and Leica appears to be well past. So much so that they’re selling nearly half of the company in order to make a big push in emerging markets. What use “emerging markets” have for $5000 cameras, clearly Leica knows better than I.
44% of the company was sold to Blackstone Group LP, which considers it a “medium- to long-term investment. The price was not disclosed, but the Wall Street Journal cites a source close to the matter who put the purchase at $179 million. If true, that would put their valuation at just north of $400m. That’s a far cry from the $82m Andreas Kaufmann paid for the nearly the entire company back in 2004, but with $250m and yearly sales and $36m in net income, it easily passes the smell test.
They’ve shown steady growth over the last few years, but that’s been primarily in Europe and the US, markets already familiar with the brand and, generally speaking, quite rich. The investment by Blackstone gives Leica some capital to work with in expanding their business to Asia, the Middle East, and Latin America. Their plans were not detailed beyond that.
That kind of money is sufficient to fuel research and development of an entirely new camera system. Is this Leica signaling that the M system is going to have a new sibling soon? It’ll be a while before the deal goes through and the money is put to use, but I’d say that’s a fairly good bet.