Coach buys Stuart Weitzman for $574 million
US leathergoods company Coach has bought luxury shoe brand Stuart Weitzman for $574 million, after its forays into the shoe sector last year fell short of expectations.
Coach will pay private equity firm Sycamore Partners – which took on the brand last year as part of the Jones Group – $530 million in cash and $44 if it hits revenue targets over the next three years. Stuart Weitzman realized net revenues of approximately $300 million for the twelve months ended September 30, 2014.
Rival private equity firms and other shoe companies submitted bids for Stuart Weitzman.
CEO of Coach, Victor Luis, said: "Importantly, the size, scope and vibrancy of the Stuart Weitzman brand, along with the continuity of its management team, allows for a seamless transition to Coach ownership, as we continue to focus on Coach’s brand transformation. Over the medium term, we look forward to advancing the Stuart Weitzman brand’s global development, especially by leveraging Coach’s international infrastructure and expertise in handbags and accessories.
"In addition, we look forward to benefiting from the Stuart Weitzman team’s expertise in footwear development where they’re proven leaders in fashion and fit."
In October, Coach outlined a plan to turn the business around after disappointing sales.
Image courtesy of Stuart Weitzman/GDS.
