30 Sep Steve Madden To Acquire Mexico Licensee
Steve Madden signed a definitive agreement to acquire Trendy Imports S.A. de C.V., Comercial Diecisiette S.A. de C.V., and Maximus Designer Shoes S.A. de C.V. (together, “SM Mexico”). As Steve Madden’s Mexican licensee, SM Mexico markets Steve Madden products in Mexico in the wholesale channel as well as in Steve Madden-branded retail stores.
“Since introducing the Steve Madden brand into Mexico in 2005, we have built a strong, loyal following for the brand and a business that is poised for growth. I look forward to working with the Steve Madden team to build upon the strong momentum we have created in Mexico.”
The purchase is a cash transaction for approximately $15 million, subject to a working capital adjustment, plus repayment of a short term loan and an earn-out provision based on future financial performance. The transaction is expected to close in January of 2015 and is expected to be accretive, contributing approximately $0.02 – $0.03 in diluted EPS in 2015.
SM Mexico is a division of Grupo Dicanco, a distributor of licensed footwear brands in Mexico. Grupo Dicanco has held the exclusive license for wholesale and retail distribution of Steve Madden footwear and accessories since 2005. SM Mexico currently distributes products in leading department stores as well as 21 Steve Madden-branded retail stores. Net sales for SM Mexico for the twelve months ended July 31, 2014 totaled approximately $15.4 million (unaudited).
Edward Rosenfeld, Chairman and Chief Executive Officer, commented, “Mexico is a strong and growing market for the Steve Madden brand. Upon the completion of this transaction, we plan to enhance our presence in leading department stores, expand into new wholesale accounts, grow our portfolio of Steve Madden retail stores and introduce certain of our other brands into the Mexican market. Diego Candano and his team have done a tremendous job in building our Steve Madden brand in Mexico, and we look forward to working with them to capitalize on the significant long term growth opportunity in this region.”
Diego Candano, founder and Chief Executive Officer of SM Mexico, stated, “Since introducing the Steve Madden brand into Mexico in 2005, we have built a strong, loyal following for the brand and a business that is poised for growth. I look forward to working with the Steve Madden team to build upon the strong momentum we have created in Mexico.”