DSW Inc. has agreed to acquire a minority stake in Canada’s Town Shoes Ltd. with the option to acquire the remaining shares.
In a move that will provide a base for DSW to expand its brand into Canada, the U.S. retailer has agreed to acquire 44 percent of Town’s shares for a cash consideration of 68 million Canadian dollars, or $62 million at current exchange. Based in Toronto, Town operates 182 stores in Canada under banners including The Shoe Co., Shoe Warehouse and Town Shoes. Its 2013 sales totaled 291 million Canadian dollars, or $280.5 million at average exchange.
The agreement gives DSW the right to acquire shares from certain minority shareholders immediately and the balance of the Canadian firm’s shares after four years at a pre-determined multiple of earnings before interest, taxes, depreciation and amortization.
The majority of Town’s shares currently are owned by Alberta Investment Management Corp. and Callisto Capital, a Canadian private equity firm. DSW’s initial stake, which would come from Alberta Investment’s shares, provides for 50 percent voting control and board representation, equal to that of Callisto.
Callisto has the right to sell the balance of the company to DSW after three years, also at a pre-determined ebitda multiple.
“We have looked at Canadian entry options for some time and decided to acquire an existing operation with a long track record of success and to use this operation as a base from which we can establish the DSW brand in Canada,” said Mike MacDonald, president and chief executive officer of Columbus, Ohio-based DSW.
Peter J. Solomon Co. advised DSW on the transaction, which is expected to be “slightly accretive” to DSW’s 2014 earnings.
Calling Alberta Investment “a great partner,” Lawrence Stevenson, chairman of Town and managing director of Callisto, said DSW would be a strong strategic partner “as we roll out DSW stores across the country.”
Canada has become a prime expansion spot for American retailers. Target Corp. initiated its expansion into Canada with the acquisition of lease rights to Zellers stores previously owned by Hudson’s Bay Co. Other U.S. retailers, including Nordstrom and Hudson’s Bay Saks subsidiary, are moving into the country through new stores and conversions of existing retail space.
DSW currently operates 407 DSW stores in 42 states, Washington and Puerto Rico, the e-commerce site dsw.com and the mobile Web site m.dsw.com. Its affiliate business group also provides footwear to 357 leased locations.
Harrods plans to remove the famous statue of Princess Diana and Dodi Al Fayed from the bottom of the Egyptian escalators and hand it back to Mohamed Al-Fayed. “We are very proud to have played our role in celebrating the lives of Diana, Princess of Wales and Dodi Al Fayed at Harrods and to have welcomed people from around the world to visit the memorial for the past 20 years,” said Michael Ward, Harrods managing director. “With the announcement of the new official memorial statue to Diana, Princess of Wales at Kensington Palace, we feel that the time is right to return this memorial to Mr. Al Fayed and for the public to be invited to pay their respects at the palace.” More on the news, with reporting by @loreleimarfil, at WWD.com. #wwdnews
@prada is introducing a new project at its men’s fall 2018 show this Sunday: “Prada Invites.” The fashion house invited four celebrated creative minds – @ronanaerwanbouroullec, Konstantin Grcic, @herzogdemeuron and @rem.koolhaas – to each create a unique item with its iconic nylon material. The designs will be unveiled on the runway show, which will take place at the company’s warehouse in Viale Ortles 25. #wwdfashion #mfwm (📷: @martinocarrera)
@kering_official is spinning off its stake in puma in an effort to focus on its luxury brands, the brand operator announced yesterday. “We are proud to have supported the turnaround of Puma, which now has unrivaled capabilities to take full advantage of the specific dynamics of its global markets and is poised to achieve substantial growth,” said François-Henri Pinault, Kering’s chief executive officer and chairman. Artémis will become a “long-term strategic shareholder” of Puma with a 29 percent stake. #wwdnews #wwdfashion (📷: @jilliansollazzo)
The fashion world mourns for celebrated street style photographer, Nabile Quenum, who died at age 32 in Paris.
Quenum, creator of the fashion blog “J’ai Perdu Ma Veste,” was a fashion week fixture, and regularly shot for New York magazine’s The Cut, among other outlets, and brands such as Louis Vuitton, Moncler and Adidas. He was also actively involved in the #NoFreePhotos initiative, which kicked off in the fall. Read more about Quenum in @kbsmoke's story on WWD.com. #wwdnews
@verwanggang and @maisonladuree have teamed up on a dessert collab called Vera Wang Pour Ladurée. The collection, which launched this week, features a specialty macaroon, as well as a wedding cake inspired by one of the designer’s gowns. “I could not imagine a more delicate or sophisticated creation to grace any couple’s celebration,” said Wang. #wwdfashion