Movado Group has entered a deal to acquire Millennial-favorite brand MVMT Watches, the company revealed today.
MVMT is relatively new to the watch game. The direct-to-consumer brand was founded in 2013 by Jake Kassan and Kramer LaPlante. The duo have made their name on well-designed watches offered at an affordable price — typically under $200. They have since added sunglasses and accessories into the line.
Watches, onetime declared a potential casualty of the Millennial generation, have proven a boon for the MVMT brand. Last year, the company, which is sold in more than 160 countries and carries a social media community of about 4.5 million followers, clocked $71 million in sales.
“My philosophy is always that Millennials will buy watches as an accessory if it is relevant to them. Last year, we bought the Olivia Burton brand that is popular in the U.K., and this year, we are excited to buy MVMT, which has done it on steroids; it’s resonating with young people,” said Movado chief executive officer and chairman Efraim Grinberg, who refers to Kassan and LaPlante as “the kids.”
Grinberg noted that the time was right for MVMT, which has “tremendous global potential. In working with them, we offer infrastructure that they’d have to be adding now. We offer advice and council.” The brand’s consumer skews 65 percent male and 35 percent female. Grinberg believes women’s watches are a huge opportunity for MVMT.
The MVMT purchase, according to Movado, entailed a $100 million initial payment as well as two future payments that could total an additional $100 million but is contingent on MVMT’s performance.
Kassan said, “As we looked at the future for MVMT, we felt Movado Group was the perfect fit to continue our growth. We share many of the same strategies as Movado Group including a focus on unique design, product innovation and providing compelling value for the consumer, which aligns us on future plans for our brand and will create a smooth transition.”
The sale is expected to be completed by Oct. 1 and is being paid for with Movado’s cash reserves and borrowings from a revolving credit facility.