Coach Inc. announced that they have completed the acquisition of shoes company Stuart Weitzman Holdings LLC.
In January 2016, Coach paid $530 million, equal to the maximum business over the next three years of Stuart Weitzman and additional floating prices $44 million to buy the high-end women’s footwear brand Stuart Weitzman from private equity fund Sycamore Partners LP.
According to the statement, Stuart Weitzman, founder of the same name of the brand Stuart Weitzman would continue to serve as Executive Chairman and Creative Director of Stuart Weitzman Holdings LLC, while the Chief Executive Officer Wayne Kulkin would remain in charge of business expansion.
As of December 31, 2016, Stuart Weitzman Holdings LLC reported revenue of $ 313 million, the company operating 45 stores in the United States and 62 in the international market.
Mostly analysts were not optimistic about the acquisition of Stuart Weitzman, but the Coach was also quite upset to acquired the Stuart Weitzman. Luxury industry analyst Tang Xiaotang also specializes in the transaction, ” Since analysts are not optimistic about the acquisition, why Coach do this”?
Coach Inc. has experienced a dismal run in the past two years, especially in the North American market, same store sales has been fell for continuously 7 quarters, losing market share and shares tumbled meantime. Last Month, Coach announced the earnings of three quarters. Although the adjusted EPS of $ 0.36 slightly over the Wall Street analysts expected an average of $ 0.35, but the group’s revenue of $ 929.3 million quarterly income was lower than analysts expected $949.9 million, in particular in main North American market, 23% double-digit decline loss of market share disappointed investors.