VF Corporation has launched a 2.3 billion dollar takeover bid on shoe producers Timberland. The bid, worth 1.5 billion euro, is so high because “Timberland are shoes of the highest quality and it will be a perfect match with our The North Face brand”, says VF’s chairman Eric Wiseman. VF will pay $43 per Timberland share, 43% more than the closing price on Friday.
In the family since 1952
Timberland was founded in 1952 by Nathan Swartz and has remained in the family ever since. The company’s peak was in the nineties – when rappers popularised the brand – but has lost its popularity since then. With one exception, Timberland’s sales have dropped continuously since 2005.
For the rich… and the Chinese
Wiseman said the will raise Timberland’s turnover, currently 1.6 billion dollar, with 10%, pointing to the ‘huge potential’ the Chinese market offers and to the current boom in the outdoor market. The latter is largely fuelled by rich people’s desire to spend money on quality products that they will never wear in the places they were made for – even during global crises.
After the takeover is complete, VF’s sports brands will make up for half of the group’s turnover of 10 billion dollar. The group’s main brands are Eastpak, Kipling, Nautica, Lee Jeans and Wrangler.
