Kate Spade LLC has acquired the 51% interest of Sanei International Co., Ltd, a kabushiki kaisha (a joint stock company) in Kate Spade Japan. The buyout cost $47.6 million, which includes debt repayment, related transaction fees and the use of Kate Spade Japan’s cash on hand.
Kate Spade Japan was formed in August 2009 between Sanei and Kate Spade. They will continue operations in Japan through its Japanese subsidiary. Their fiscal year, which ended August 31,2012 saw net sales of $88 million, which is 20% higher than the previous fiscal year. Kate Spade Japan has 53 points of sale product distributors in Japan, including department store concessions and e-commerce. This buyout is not expected to have a material impact on the company’s adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of 2012.
The buyout is part of Kate Spade LLC’s aggressive international push, which includes fully or partially owning the majority of its Asia-based businesses. Their CEO Craig Leavitt said in a previous statement that the brand has had a long and very successful history with Asian markets and their strategy is to build a global company to support that global brand. Kate Spade has 41 specialty shops in the United States, a thriving e-commerce business, 94 shops internationally, new flagships in Brazil and London and distribution in more than 400 doors worldwide.
[ via Talk Fashion World ]
Comments Off on JDP Startup Corner: Pros & Cons of Working with a Partner in Japan