Footwear Giant Skechers To Go Private At 30% Premium In PE Deal

Footwear giant Skechers U.S.A. Inc. SKX stock is soaring on Monday. The company agreed to go private following its acquisition by global investment firm 3G Capital.

The agreement offers shareholders $63.00 per share in cash, a 30% premium over Skechers' recent trading average or a blended option of cash and equity units in the post-transaction entity.

This amounts to a deal value of $9.54 billion calculated using 151.49 billion weighted-average shares used in calculating net earnings per share.

3G Capital and Skechers' management see the deal as a long-term growth opportunity for the California-based footwear leader.

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Robert Greenberg will remain chairman and CEO, joined by Michael Greenberg as president and David Weinberg as COO. The leadership team will continue to drive Skechers' strategy. The company will keep its headquarters in Manhattan Beach, California.

Under the deal's terms, investors may choose the all-cash option or a mixed package of $57.00 per share and a non-tradable equity unit in the new private company.

The mixed consideration is limited to 20% of total shares, and selections exceeding this cap will be adjusted proportionally. Shareholders who do not make a selection will receive the full-cash option by default.

The transaction has already secured consent from stakeholders holding around 60% of Skechers' voting power, meaning no further shareholder vote is necessary.

The board of directors guided by an independent committee unanimously approved the agreement. The deal is expected to close in the third quarter of 2025, pending regulatory review and customary closing conditions.

In FY24, Skechers recorded a 12.1% increase in revenue to $8.97 billion, with a 13.2% growth in Wholesale sales and a 10.7% increase in Direct-to-Consumer sales.

The buyout will be financed through a combination of capital from 3G and debt underwritten by JPMorgan Chase Bank. Upon finalization, Skechers' shares will be delisted from the New York Stock Exchange.

Price Action: SKX shares traded higher by 25.1% at $61.75 at last check Monday.

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