V.F. Corp Closes Timberland Deal - Analyst Blog
15 Settembre 2011 - 2:15PM
Zacks
In a recent development,
V.F. Corporation (VFC) has completed the
acquisition of Timberland Co. (TBL) for $43 per
share, representing a total consideration of $2.3 billion.
V.F. Corporation financed the
transaction with the issuance of $400.0 million of floating rate
notes as of August 24, 2011 to be matured in 2013 and 3.5% notes
worth $500.0 million maturing in 2021. The balance of the
acquisition amount has been financed by the company through cash in
hand, commercial paper and term debt.
V.F. Corporation's portfolio of
outdoor and action sports business, comprising Vans, Jansport,
Eastpak and other brands, is expected to contribute 50% to the
company's revenues after the inclusion of Timberland brands, and is
projected rise to 60% by 2015.
The deal is expected to increase
V.F. Corporation's profit by 25 cents a share, including
acquisition related expenses and revenues by $700 million in fiscal
2011. While in fiscal 2012, the deal is expected to add 75 cents to
the earnings of the company. When the news of acquisition came,
Timberland was expecting annual sales of $1.6 billion in fiscal
2011 while V.F. Corporation targeted an annual revenue growth of
10%.
V.F. Corporation has also announced
that Timberland's two strongest and authentic brands, Timberland
and Smartwool, will remain headquartered in Stratham and Steamboat
Springs, Colorado, respectively.
Headquartered in Stratham, New
Hampshire, Timberland designs, engineers and markets
premium-quality footwear, apparel and accessories for consumers and
had generated total revenue of $1.4 billion in fiscal 2010.
Timberland markets products under the Timberland, Timberland PRO,
Mountain Athletics, SmartWool, Timberland Boot Company and Howies
brands.
Based in Greensboro, North
Carolina, V.F. Corporation is one of the world's largest apparel
companies. The company, together with its subsidiaries, engages in
the design, manufacture, and marketing of branded apparel and
related products in the United States and internationally. Major
competitors of the company are Gap Inc. (GPS) and
Sears Holdings Corporation (SHLD).
V.F. Corporation currently retains
a Zacks #1 Rank, which translates into a short-term 'Strong Buy'
rating. However, we maintain a long-term 'Neutral' recommendation
on the stock.
GAP INC (GPS): Free Stock Analysis Report
SEARS HLDG CP (SHLD): Free Stock Analysis Report
TIMBERLAND CO A (TBL): Free Stock Analysis Report
V F CORP (VFC): Free Stock Analysis Report
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