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DSW to Acquire Footwear and Accessories Designer Camuto in USD 375m Deal
Thursday 11 October 2018

11 October 2018 - US-based footwear and accessories retailer DSW Inc. (NYSE: DSW) has entered into a definitive agreement to acquire the operations of product design and brand development organisation Camuto Group, the company said.

Camuto Group is best known for the successful Vince Camuto brand and the footwear licenses of Jessica Simpson and Lucky Brand.

Additionally, DSW Inc. and Authentic Brands Group LLC, a global brand development, marketing and entertainment company, have entered into a definitive agreement to acquire several intellectual property rights from the Camuto Group under a new partnership.

Total consideration paid to the Camuto Group will be approximately USD 375m.

The Camuto Group will maintain its existing Connecticut headquarters and will manage its dedicated wholesale and third-party design relationships independently of DSW Inc's retail business.

Camuto Group's chief executive officer Alex Del Cielo will continue to lead the organization.

DSW said the acquisition of Camuto will bring a healthy brand portfolio with attractive growth prospects in wholesale and direct-to-consumer that can leverage DSW's expertise and infrastructure.

It will also bring substantial growth in Camuto's third-party licensing and international distribution business in partnership with ABG.

Plus, there will be new revenue opportunities from a larger addressable market and a strategic partnership with ABG that leverages their expertise in brand management and marketing across various brands and platforms.

DSW also gains immediate access to a talent base in design, sourcing, marketing and sales to support the growth of DSW's exclusive brands over time.

Under the terms of the agreement, DSW Inc. will contribute approximately USD 200m to acquire all of Camuto Group's global production, sourcing and design infrastructure, including operations in Brazil and China, a new, distribution centre in New Jersey, in addition to existing working capital of approximately USD 100m.

DSW Inc. will also acquire the licensing rights for the Jessica Simpson footwear business, as well as the footwear and handbag licenses for Lucky Brand and Max Studio.

The company will also acquire joint venture participation in the ED Ellen DeGeneres and Mercedes Castillo brands currently managed by the Camuto Group.

DSW will also contribute approximately USD 56m to acquire a 40% stake in the intellectual property of Camuto Group's proprietary brands with Authentic Brands Group taking the majority state of 60%.

Brands include Vince Camuto, Louise et Cie, Sole Society, CC Corso Como, Enzo Angiolini and others.

The partnership will focus on licensing the brands across existing lines in footwear, handbags and jewelry, and new category development with a focus on building out each brand's lifestyle offerings.

Authentic Brands Group will hold a majority stake in the joint venture and will be responsible for the development, growth and global marketing of the brands.

DSW will fund its portion of the transaction through current cash and its existing credit facility. The transaction, which has been approved by the DSW Inc. board of directors, is subject to customary closing conditions and is expected to close at the beginning of the company's fiscal fourth quarter.

All Hart-Scott-Rodino Act waiting periods applicable to the transaction have expired and no further merger control clearances are required.

DSW is a footwear and accessories retailer that operates a portfolio of several value retail concepts under the DSW Designer Shoe Warehouse, Shoe company, Shoe Warehouse and Town Shoes brands.

Goldman Sachs and Co. LLC is serving as exclusive financial advisor to DSW Inc. and Wachtell, Lipton, Rosen and Katz is serving as legal advisor to DSW Inc. Paul Weiss, Rifkind, Wharton and Garrison LLP is serving as legal advisor to Authentic Brands Group. MMG Advisors Inc. is serving as financial advisor to Camuto Group. Pryor Cashman LLP is serving as legal advisor to Camuto Group.
Details
Date Published: 11/10/2018
Target: Camuto Group
Country: USA
Deal Size: 375m (USD)
Sector: Clothing/Textiles
Type: Corporate acquisition
Financing: Cash
Status: Agreed
Vendor:
Buyer: DSW Inc
Buyer Advisor: Goldman Sachs and Co , Wachtell, Lipton, Rosen and Katz , Paul Weiss, Rifkind, Wharton and Garrison
Comment:
DSW and Authentic Brands Group have entered into a definitive agreement to acquire several intellectual property rights from the Camuto Group under a new partnership

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