Canadian company acquires Virginia Beach-based Swimways Corp.

Toronto-based Spin Master Corp., a children's entertainment company, has acquired Virginia Beach-based Swimways Corp. and formed an outdoor business segment.

Swimways makes a wide variety of toys, games and sporting goods for the pool, beach and backyard. Its gross sales last year were about $90 million.

“This will allow Swimways and its brands to grow and expand by harnessing Spin Master's global infrastructure,” Swimways President David Arias said in a statement. “We share a spirit of innovation, expertise in maximizing licensing partnerships and a commitment to quality that will provide a strong foundation for growth moving forward.”

Arias’ family has owned the company for more than two decades.

Under the acquisition agreement, Spin Master will pay $85 million in cash on closing, less an escrow for possible adjustments, plus up to $8.5 million payable over four years based on Swimways' sales growth. The transaction was financed through Spin Master's existing credit facility.  Swimways will operate as a stand-alone subsidiary within the Spin Master group.

Swimways has 149 employees. It has an office in Guangzhou, China, a manufacturing and distribution facility in Tarboro, N.C.

Spin Master said the acquisition will establish it as a key player in the outdoor and sports toys category, which currently is one of the largest and fastest growing categories in the U.S. toy industry.

Swimways' leadership team will direct Spin Master's outdoor segment from its current headquarters in Virginia Beach.