Crocs Inc. plans on buying back and converting some of the preferred shares held by Blackstone Group LP in the latest sign that a multi-year turnaround effort has been working in the company's favor.

The company will pay 183.7 million dollars for half the preferred stock Blackstone acquired as part of a 200 million dollar investment back in 2014, the company said in a statement today. At the start of the deal Crocs shares were trading at 15 dollars and are now trading at 27 dollars and 80 cents.

“Blackstone’s influence and impact on the company has been extremely positive in terms of bringing in new executives and guiding strategy,” CEO Andrew Rees said in an interview with Business of Fashion. “It puts us in a place today where we have the financial strength to buy back” the shares.

After the injection of capital from Blackstone, Crocs closed under performing stores and exit markets where they weren't turning a profit. They then focused on cutting inventory and increasing gross margins. Currently, Crocs is looking to expand their product offerings and grow their e-commerce presence.

Crocs will finance the transaction with a combination of cash on hand and borrowing from its existing credit line, according to the statement. Blackstone has agreed to convert its remaining stake into common stock, creating about 6.9 million shares, also won't trade that common stock for nine months.

 

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