- Simone Preuss |
In a deal worth 574 million US dollars, luxury accessories and lifestyle brand Coach has acquired women's luxury footwear designer and manufacturer Stuart Weitzman from private equity firm Sycamore Partners.
This transaction will cement Coach's current leading global position in premium handbags and accessories, while immediately contributing to the company's earnings as Coach continues to make meaningful progress in terms of its brand transformation that was announced earlier this year.
Stuart Weitzman earned net revenues of 313 million US dollars for the fiscal year that ended on December 31, 2014. Coach made an initial cash payment of approximately 530 million US dollar to Sycamore Partners when closing the deal. In addition, Coach will make up to 44 million US dollars in contingent payments to the private equity firm upon the successful achievement of selected revenue targets over the next three years.
Coach financed the transaction with cash on hand. The acquisition is expected to be accretive to earnings per share, exclusive of transaction-related charges including anticipated purchase accounting adjustments and contingent payments related to the transaction.
Stuart Weitzman will continue as creative director and executive chairman of Stuart Weitzman Holdings LLC and will together with CEO Wayne Kulkin and their management team "remain fully committed to the growth of the business" according to a press release.
Stuart Weitzman markets its products in specialty and department stores worldwide - currently in 70 countries - and also operates its own retail stores. Currently, the company has 46 retail stores across the United States, including New York, Beverly Hills, Chicago, Boston and Las Vegas, and 67 international ones, of which eight are in directly operated locations and 19 in global shop-in-shops. In addition, Stuart Weitzman also operates e-commerce sites in the US, Canada, Europe and Hong Kong.Images: Stuart Weitzman, Coach