PVH Corp. brought the Tommy Hilfiger business in China fully under its wing.
The company said Wednesday that it completed its acquisition of the 55 percent interest in the TH Asia Ltd. joint venture that it didn’t already own. The deal weighed in at $172 million, net of roughly $100 million in cash, and was revealed in February. PVH expects the business to add about $100 million to its revenues and to be slightly accretive to adjusted earnings this year.
The deal, with Apax Partners, marks a completion of sorts of the company’s six-year-long move to buy the Tommy Hilfiger business from the private equity firm.
“This transaction has been envisioned since PVH and the funds advised by Apax Partners established the Tommy Hilfiger China joint venture in connection with the Tommy Hilfiger acquisition in 2010,” said Emanuel Chirico, chairman and chief executive officer of PVH. “With the closing of this transaction, our Tommy Hilfiger business can now operate directly in its fastest-growing market, while leveraging our well-established infrastructure in Asia, our regional leadership expertise and strong brand momentum across both our Tommy Hilfiger and Calvin Klein businesses in the region.”
In China, Hilfiger has 350 doors, including 65 directly operated stores and franchised doors.
Chirico said in February that Hilfiger’s men’s sportswear represents 75 percent of the Chinese business, but that there were opportunities to grow the women’s denim, accessories and footwear parts of the business.
Dealmaking has been relatively weak so far this year in the consumer space.
Mergermarket’s recent tally of first-quarter of global consumer mergers and acquisitions found that both the number of deals and in their overall size declined from a year earlier. Deal value eroded 66.5 percent to $45.9 billion and the number of deals fell off 14.1 percent to 449.
There has been some cross-border activity, although people are generally watching for the deal flow to go in the other direction and more along the lines of Chinese textile company Shandong Ruyi Group’s recently inked a deal to acquire control of the Sandro, Maje and Claudie Pierlot fashion chains from KKR.