Major Luxury Fashion Brand to Acquire Iconic Footwear Brand
A well-known brand has officially reached an agreement to purchase another well-known brand.
Global luxury fashion brand Michael Kors recently announced that it would be closing between 100 and 125 stores over the next two years, and now, the company is officially buying out footwear and accessories brand Jimmy Choo.
“Fiscal 2017 was a challenging year, as we continued to operate in a difficult retail environment with elevated promotional levels,” said John Idol, chairman and Chief Executive Officer (CEO) at Michael Kors, in reference to Michael Kors's store closings. “In addition, our product and store experience did not sufficiently engage and excite consumers.”
Jimmy Choo shareholders are set to receive 230 pence per share after the acquisition, and the deal is valued at approximately USD $1.35 billion.
"We believe that Jimmy Choo is poised for meaningful growth in the future and our company is committed to supporting the strong brand equity that Jimmy Choo has built over the last 20 years," said Idol.
Jimmy Choo's CEO, Pierre Denis, will reportedly continue his executive position. Denis has led Jimmy Choo since 2012, when the iconic brand experienced compounded sales growth of 11 per cent annually, according to Idol.
"Jimmy Choo is a premier fashion luxury house that offers distinctive footwear, handbags and other accessories. We admire the glamorous style and trendsetting nature of Jimmy Choo designs. We look forward to welcoming Jimmy Choo to our luxury group," said Michael Kors himself, honorary chairman and chief creative officer of Michael Kors.
According to the Michael Kors company, acquiring Jimmy Choo gives the company the opportunity to grow Jimmy Choo sales to $1 billion, and to grow in the men's luxury footwear category.
Jimmy Choo currently has approximately 150 company-operated retail stores, 560 multi-brand doors and more than 60 franchise stores in premier locations worldwide.
The deal is expected to be completed in the final quarter of 2017.