ICON Reached Final Agreement With Nike To Acquire Starter Brand
IconixBrandGroup, Inc. (Nasdaq:ICON) announced that the company has reached a final agreement on the acquisition of NIKE (Inc.) (NYSE:NKE) Starter brand of Nike.
The purchase price will reach US $60 million and the mode of payment will be cash.
The paction is expected to be completed in December.
Starter was first established in 1971 to start the alliance authorized garment business. Currently, it has been authorized by several manufacturers / wholesalers, mainly in the US, Canada and Mexico through WAL-MART (Wal-Mart).
Iconix expects the global royalty earnings from Starter will be around $18 million in 2008.
NeilCole, chairman and chief executive of Iconix, said: "Starter is a landmark brand that brings us into sports apparel, group sports and sports shoes, achieving the diversification of our product mix.
This is a brand that has great potential in the US and the world.
I believe Iconix will add a lot of value to this brand quickly.
We are excited about the potential of the brand, especially considering the strong coverage of WAL-MART as a retailer and our marketing expertise.
We believe that Starter has the potential to become one of the largest brands of sportswear and sports shoes in the world.
To help develop this potential, we are implementing multifaceted strategies, including signing agreements with some major professional sports brands and developing our team sports business, which is also the original business of Starter. "
DottieMattison, senior vice president and purchasing manager of WAL-MART apparel department, said: "our customers are very positive about our sports apparel and sports shoes brands at important price points.
Starter is one of the most powerful brands of existing assets and different categories of coverage.
Iconix is an innovator in brand marketing and brand building. We value their plan for Starter very much. "
Iconix also owns brand DanskinNow and OP, and the two brands are also licensed to WAL-MART.
The acquisition is still subject to customary closing conditions, including the request for a revised version of the Hart-Scott-RodinoAntitrustImprovementsActof1976 (1976Hart-Scott-Rodino anti trust Improvement Act).
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