Timberland, purveyor of rugged boots and waterproof jackets to outdoorsy types, is being taken over by the world's largest apparel company in a US$2 billion deal.
VF Corporation, whose portfolio of brands includes Lee, Wrangler, Vans and The North Face, said outdoor clothing was among the fastest-growing apparel categories, and
central to its plans for growth.
"The Timberland brand is synonymous with high-quality outdoor footwear and apparel," said Eric Wiseman, VF Corporation's chief executive, who added that the company had been on its acquisition list for years.
"The unique rugged outdoor positioning of Timberland will perfectly complement the premium, technical positioning of The North Face brand."
The addition of Timberland hiking boots to the corporate wardrobe excited investors, who sent VF Corporation's shares up more than 10 per cent, their best one-day performance since 2008. The deal has received the backing of Timberland's founding Swartz family.
Nathan Swartz turned Abington Shoe Company, a small-time Massachusetts manufacturer which he bought in 1952, into a global powerhouse thanks to the creation of the Timberland boot in 1973.
The company, now run by his grandson, Jeffrey Swartz, makes US$1.6 billion ($1.9 billion) in annual sales, half of which are in the US. Now based in New Hampshire, Timberland also owns the Mountain Athletics and SmartWool brands.
VF Corporation was founded as the Reading Glove and Mitten Manufacturing Company in Pennsylvania in 1899. After yesterday's share price jump, the group has a market value of more than US$12 billion.
Although the deal was approved unanimously by both boards, they left open the possibility that another bidder will emerge for Timberland. The company can solicit higher bids until next month, but will have to pay a US$87.2 million break fee to VF Corporation if it walks away.
- Independent
