VF Corp., the owner of Wrangler jeans and The North Face outdoor gear, has bought the popular outerwear and footwear brand Timberland Co. for $2 billion.
This deal is the largest in the footwear industry in at least five years and also the largest brand purchase for the VF group.
According to Eric Wiseman, chairman and chief executive officer of VF, “We believe the unique rugged outdoor positioning of the Timberland brand will perfectly complement the premium, technical positioning of The North Face brand, while the Smartwool brand will provide us with a leadership position in a new category. This acquisition will continue the transformation of VF’s portfolio, propelling VF’s Outdoor & Action Sports businesses to 50 percent of total revenues.”
Established in 1952 and most remembered for its yellow colored boots, Timberland has seen a downward trend in its sales figures since the recent recession. Increasing costs in terms of leather, labor, and logistics have been a key factor in the company’s drop in profitability. Its share price has plummeted 26 percent this year, its largest drop in 26 years, even resulting in shareholders instigating a class-action lawsuit alleging the company deceived investors.
“Timberland is proud of its rich heritage, its track record of success, and its reputation as a responsible and environmentally conscious global citizen, all of which will be preserved and enhanced by becoming part of the VF family of brands,” said Jeffrey Swartz, president and chief executive officer of Timberland.
VF Corp, the world’s largest apparel maker, predicts that Timberland will be able to bring in sales of $1.6 billion in 2011—with the majority of purchases coming from overseas—followed by a 10 percent increase in annual sales in 2012.
This deal is the largest in the footwear industry in at least five years and also the largest brand purchase for the VF group.
According to Eric Wiseman, chairman and chief executive officer of VF, “We believe the unique rugged outdoor positioning of the Timberland brand will perfectly complement the premium, technical positioning of The North Face brand, while the Smartwool brand will provide us with a leadership position in a new category. This acquisition will continue the transformation of VF’s portfolio, propelling VF’s Outdoor & Action Sports businesses to 50 percent of total revenues.”
Established in 1952 and most remembered for its yellow colored boots, Timberland has seen a downward trend in its sales figures since the recent recession. Increasing costs in terms of leather, labor, and logistics have been a key factor in the company’s drop in profitability. Its share price has plummeted 26 percent this year, its largest drop in 26 years, even resulting in shareholders instigating a class-action lawsuit alleging the company deceived investors.
“Timberland is proud of its rich heritage, its track record of success, and its reputation as a responsible and environmentally conscious global citizen, all of which will be preserved and enhanced by becoming part of the VF family of brands,” said Jeffrey Swartz, president and chief executive officer of Timberland.
VF Corp, the world’s largest apparel maker, predicts that Timberland will be able to bring in sales of $1.6 billion in 2011—with the majority of purchases coming from overseas—followed by a 10 percent increase in annual sales in 2012.
