Palliser Furniture Acquired by China-based MotoMotion

Full-line furniture manufacturer Palliser has been sold to longtime supplier and strategic partner MotoMotion.

The deal was completed May 29, according to an employee memo from Palliser executive chairman Art DeFehr and president and CEO Peter Tielmann, which was obtained by Home News Now. The memo describes MotoMotion as a publicly listed company with more than 7,000 employees and manufacturing operations in Vietnam, China and Cambodia, as well as a U.S. presence in Arcadia, Calif. Terms of the transaction were not disclosed.

The memo stated that Palliser’s Winnipeg base will continue as a centre for product development, design, innovation, marketing, sales, customer service and brand leadership. Further, there will be no immediate changes to various roles or to the Winnipeg head office team as a result of the purchase.

It said Canadian manufacturing operations are not included in the transaction because they are owned and operated by EQ3, which will continue as a separate entity.

The acquisition is notable because Palliser launched a major Canadian trade case against upholstered seating imports from China and Vietnam. MotoMotion is tied to China-based Changzhou Jiangxin Duju Smart Home Co. Ltd., also known as HHC Group.

The Canada Border Services Agency (CBSA) received a complaint from Palliser in fall 2020, alleging that imports from the two countries were harming Canadian producers.

The Canadian International Trade Tribunal later concluded that dumping and subsidizing of certain upholstered seating from China and Vietnam had caused injury to the domestic industry. In its Sept. 2, 2021, release, the tribunal said anti-dumping and countervailing duties would be collected by CBSA.

Palliser’s complaint was supported by several Canadian companies, including EQ3, Fornirama, Elran and Jaymar, according to CBSA’s statement of reasons.

The acquisition follows a period of liquidity and supply challenges at Palliser. In April, Home News Now reported that Palliser had told dealers it was working with MotoMotion to stabilize supplier relationships and accelerate material flow back into its factories after payment timing issues disrupted raw material availability and delayed orders.

MotoMotion and Palliser have had a supplier relationship for more than a decade. In the memo cited by Home News Now, Palliser executives framed the acquisition as a continuation of that partnership and said MotoMotion’s investment was also an investment in Palliser’s North American presence, including its Winnipeg head office.