Wolverine Worldwide, parent to Merrell, Chaco and Patagonia Footwear, will add Saucony to its list of outdoor and running brands as the company announced a deal Tuesday to acquire Collective Brands’ Performance and Lifestyle groups for approximately $1.23 billion.
The acquisition, which is expected to close sometime in the late third quarter or early fourth quarter, also includes Collective’s Sperry Top-Sider, Stride Rite and Keds marks. Including Saucony, the four brands produced about $1 billion in revenue in 2011. All together, Wolverine would grow to 16 outdoor, athletic and lifestyle shoe brands with sales of about $2.5 billion, officials said.
Investment firms Blum Capital and Golden Gate will jointly acquire the operations of Collective’s Payless ShoeSource and Collective Licensing International for about $770 million, which together will operate as a standalone entity.
The deal would be the largest in the footwear industry since VF Corp. bought Timberland for $2 billion last summer.
"Our company is thrilled to add these four iconic brands to our proven global platform," Wolverine Worldwide CEO Blake Krueger said in a statement. “Saucony's leadership in the athletic space complements Merrell to provide a powerful resource in running, training, trail, minimalist and barefoot footwear.”
Saucony, which got its start in 1898, was acquired by Stride Rite Corp. in 2005. Payless ShoeSource then bought out Stride Rite, including Saucony, in 2007 to create Collective Brands. In 2011, it reported approximately $270 million in sales with 54 percent of its business to women, officials said.
On the company's conference call Tuesday, Krueger said Wolverine will look to grow Saucony's international sales, which accounted for 23 percent of the business in 2011. The new ownership also indicated a plan to accelerate the growth of Saucony's running apparel line.
Saucony is based in Lexington, Mass., where it will continue to operate with the other three Collective brands, officials said. Wolverine is based in Rockford, Mich.
Wolverine recently reported lower revenue and profit for the first quarter 2012, but officials said they were upbeat about the second half of the year.