Acquisition of iconic brand expands
leadership position in the global fashion luxury segment and
strengthens future growth opportunities
Michael Kors Holdings Limited (NYSE:KORS), a global fashion
luxury brand, today announced that it has reached an agreement to
acquire Jimmy Choo PLC (LON:CHOO), a premier global luxury footwear
and accessories brand. Under the terms of the transaction, Jimmy
Choo shareholders will receive 230 pence per share, with an
enterprise value of approximately USD $1.350 billion. The
transaction has been approved by the Boards of Directors of both
Michael Kors and Jimmy Choo.
John D. Idol, Chairman and Chief Executive Officer of Michael
Kors, said, “We are pleased to announce the acquisition of Jimmy
Choo, an iconic brand with a rich history as a leading global
luxury house. Jimmy Choo is known worldwide for its glamorous and
fashion-forward footwear. The company is a leader in setting
fashion trends. Its innovative designs and exceptional
craftsmanship resonate with trendsetters globally. We believe that
Jimmy Choo is poised for meaningful growth in the future and our
company is committed to supporting the strong brand equity that
Jimmy Choo has built over the last 20 years.”
Mr. Idol continued, “Pierre Denis will continue in his role as
Chief Executive Officer of Jimmy Choo. He has led the company since
2012, during which time Jimmy Choo experienced compounded sales
growth of 11% annually. Pierre brings more than 25 years of
experience and a strong track record with global fashion luxury
brands. Additionally, Creative Director Sandra Choi will continue
to lead the creative and design teams at the company. Sandra has
been with Jimmy Choo since its inception and has been the sole
Creative Director since 2013. Her groundbreaking vision and fashion
artistry have created a truly iconic and internationally recognized
luxury brand. Mr. Denis, Ms. Choi and the rest of the
highly-talented management team have done a tremendous job, and
this continuity of leadership will ensure that the DNA of Jimmy
Choo is maintained as we work together to continue to grow the
brand globally.”
Michael Kors, Honorary Chairman and Chief Creative Officer of
Michael Kors, said, “Jimmy Choo is a premier fashion luxury house
that offers distinctive footwear, handbags and other accessories.
We admire the glamorous style and trendsetting nature of Jimmy Choo
designs. We look forward to welcoming Jimmy Choo to our luxury
group.”
Pierre Denis, Chief Executive Officer of Jimmy Choo, said, “It
is a privilege for our management team to lead Jimmy Choo and to
preside over such an exciting period for our company. We are
convinced that there is so much more that can be delivered in the
years ahead. We look forward to working closely with the leadership
and team at Michael Kors Holdings Limited to further develop our
iconic brand. Our two companies share the same vision of style and
trend leadership. Our luxury heritage is the foundation of Jimmy
Choo and we will continue to bring our brand vision to consumers
globally.”
Iconic and Powerful Luxury Brand
Jimmy Choo is a luxury accessories brand that offers an
empowered sense of glamour and a playfully daring spirit. Since its
inception in 1996, the company has offered distinctive, glamorous
and fashion-forward products, with luxury footwear at the heart of
its unique brand DNA. The brand began as a bespoke atelier that
catered to the global luxury consumer, and continues to be popular
with style icons around the globe, including celebrities, royalty,
musicians and heads of state. Jimmy Choo offers exceptionally
crafted products of the highest quality, with a design team that is
at the forefront of interpreting fashion trends in footwear and
accessories. The collections reflect a mix of iconic, timeless
products that appeals to a broader audience, as well as innovative
offerings that are targeted to fashion trendsetters globally.
With approximately 150 company-operated retail stores, 560
multi-brand doors and more than 60 franchise stores in premier
locations worldwide, Jimmy Choo has a successful, balanced
distribution network. The company has a strong presence in Europe,
the Middle East, the Americas and Asia. In addition, Jimmy Choo
continues to invest significantly in its online platform, which has
experienced strong revenue growth in recent years.
The company also continues to build its presence in accessories
and men’s footwear. The brand has a natural authority in men’s
evening shoes, adding a twist to classic shapes, and has also seen
strong growth in luxury active footwear. By integrating a dual
gender product portfolio into its retail stores, Jimmy Choo expects
to unlock additional value from this fast growing segment of the
business.
Strategic Rationale
The acquisition of Jimmy Choo is expected to deliver a number of
benefits, including:
- The opportunity to grow Jimmy Choo
sales to $1 billion
- A more balanced portfolio with greater
product diversification
- An enhanced positioning in the
attractive and growing luxury footwear segment
- The opportunity to grow in the men’s
luxury footwear category
- Further expansion in the luxury
accessories market
- Greater exposure to global markets,
particularly the fast-growing market in Asia
- The potential to create long-term
operational synergies
Transaction Details
The transaction is not subject to a financing condition. Michael
Kors has committed bridge financing from JPMorgan Chase Bank, N.A.
and Goldman Sachs Bank USA to satisfy the certain funds requirement
of the U.K. Takeover Code to complete the transaction. The
transaction is intended to be effected by a U.K. court-approved
Scheme of Arrangement (the “Scheme”) and is expected to close in
the fourth quarter of calendar 2017, subject to customary closing
conditions, including the receipt of required regulatory approvals
as well as the approval of the Scheme by Jimmy Choo shareholders,
who together hold at least 75% of the issued share capital of Jimmy
Choo and represent a majority of the shareholders voting at the
meeting. Michael Kors has received irrevocable undertakings from
JAB Luxury GmbH, Jimmy Choo directors and Sandra Choi, who
collectively represent 69.21% of the issued and outstanding Jimmy
Choo shares in support of the transaction.
Financial Considerations
Michael Kors Holdings Limited believes that the acquisition
enhances the company’s economic value and will drive improved
long-term shareholder value. The acquisition is expected to be
accretive on a GAAP basis in fiscal 2020.
Conference Call and Additional Information
Michael Kors will host a conference call to discuss the
transaction at 8:00 a.m. ET today, July 25, 2017. A live webcast of
the conference call will be available in the investor relations
portion of the Company’s website, www.investors.michaelkors.com.
For additional information concerning the transaction, please see
the investor presentation available on the Investor Relations page
of the Michael Kors website at www.investors.michaelkors.com as
well as the Rule 2.7 announcement available on the Michael Kors
website at and on the Jimmy Choo website at
http://www.jimmychooplc.com/investors/strategic-review-documents-announcements.
For the avoidance of doubt, the contents of those websites are not
incorporated into and do not form part of this press release.
About Michael Kors
Michael Kors is a world-renowned, award-winning designer of
luxury accessories and ready-to-wear. His namesake company,
established in 1981, currently produces a range of products under
Michael Kors Collection, MICHAEL Michael Kors and Michael Kors
Mens, including accessories, ready-to-wear, footwear, wearable
technology, watches, and a full line of fragrance products. Michael
Kors stores are operated in the most prestigious cities in the
world. In addition, Michael Kors operates digital flagships across
North America, Europe and Asia, offering customers a seamless
omni-channel experience. Michael Kors Holdings Limited is publicly
listed on the New York Stock Exchange with the ticker KORS.
About Jimmy Choo
Jimmy Choo encompasses a complete luxury accessories brand.
Women’s shoes remain the core of the product offering, alongside
handbags, small leather goods, scarves, sunglasses, eyewear, belts,
fragrance and men’s shoes. CEO Pierre Denis and Creative Director
Sandra Choi together share a vision to create one of the world’s
most treasured luxury brands. Jimmy Choo has a global store network
encompassing more than 150 stores and is present in the most
prestigious department and specialty stores worldwide. Jimmy Choo
PLC is publicly listed on the London Stock Exchange with the ticker
CHOO.
Forward-Looking Statements
This press release contains statements which are, or may be
deemed to be, “forward-looking statements”. Forward-looking
statements are prospective in nature and are not based on
historical facts, but rather on current expectations and
projections of the management of Michael Kors and Jimmy Choo about
future events, and are therefore subject to risks and uncertainties
which could cause actual results to differ materially from the
future results expressed or implied by the forward-looking
statements. The forward-looking statements contained in this press
release include statements relating to the expected effects of the
acquisition on Michael Kors and Jimmy Choo, the expected timing and
scope of the acquisition and other statements other than historical
facts. All statements other than statements of historical facts
included in this press release may be forward-looking statements.
Without limitation, any statements preceded or followed by or that
include the words “targets”, “plans”, “believes”, “expects”,
“aims”, “intends”, “will”, “should”, “could”, “would”, “may”,
“anticipates”, “estimates”, “synergy”, “cost-saving”, “projects”,
“goal”, “strategy”, “budget”, “forecast” or “might” or, words or
terms of similar substance or the negative thereof, are
forward-looking statements. Forward-looking statements include
statements relating to the following: (i) future capital
expenditures, expenses, revenues, earnings, economic performance,
indebtedness, financial condition, dividend policy, losses and
future prospects; (ii) business and management strategies and the
expansion and growth of Jimmy Choo’s and Michael Kors’ operations
and benefits from the acquisition; and (iii) the effects of
government regulation on Michael Kors’ or Jimmy Choo’s business.
These forward-looking statements are not guarantees of future
financial performance. Such forward-looking statements involve
known and unknown risks and uncertainties that could significantly
affect expected results and are based on certain key assumptions.
Many risks, uncertainties and other factors could cause actual
results to differ materially from those projected or implied in any
forward-looking statements. These risks, uncertainties and other
factors include the satisfaction of the conditions to consummating
the acquisition, Michael Kors’ ability to integrate the businesses
successfully and to achieve anticipated benefits of the
acquisition; the risk of disruptions to Michael Kors’ or Jimmy
Choo’s businesses; the negative effects of the announcement of the
proposed acquisition or the consummation of the proposed
acquisition on the market price of the Michael Kors’ ordinary
shares and its operating results; significant transaction costs;
unknown liabilities; the risk of litigation and/or regulatory
actions related to the proposed acquisition; fluctuations in demand
for Jimmy Choo’s and Michael Kors’ products; changes in consumer
traffic and retail trends; loss of market share and industry
competition; fluctuations in the capital markets; fluctuations in
interest and exchange rates; the occurrence of unforeseen disasters
or catastrophes; political or economic instability in principal
markets; adverse outcomes in litigation; and general, local and
global economic, political, business and market conditions, as well
as those risks set forth in the reports that Michael Kors files
from time to time with the U.S. Securities and Exchange Commission.
Other unknown or unpredictable factors could cause actual results
to differ materially from those in the forward-looking statements.
Such forward-looking statements should therefore be construed in
the light of such factors. Unless otherwise required by applicable
law, neither Michael Kors nor Jimmy Choo, nor any of their
respective associates or directors, officers or advisers, provides
any representation, assurance or guarantee that the occurrence of
the events expressed or implied in any forward-looking statements
in this press release will actually occur. Due to such
uncertainties and risks, readers are cautioned not to place undue
reliance on such forward-looking statements. All subsequent oral or
written forward-looking statements attributable to Michael Kors or
Jimmy Choo or any of their respective members, directors, officers
or employees or any persons acting on their behalf are expressly
qualified in their entirety by the cautionary statement above.
Michael Kors and Jimmy Choo disclaim any obligation to update or
revise any forward-looking or other statements contained herein
other than in accordance with their legal and regulatory
obligations.
Important information
This press release is for information purposes only and is not
intended to, and does not, constitute or form part of an offer to
purchase or the solicitation of an offer to sell any securities or
the solicitation of any vote or approval in any jurisdiction
pursuant to the Scheme or otherwise. The proposed acquisition will
be implemented solely pursuant to the terms of a Scheme Document,
which will contain the full terms and conditions of the proposed
acquisition. Any decision in respect of, or other response to, the
proposed acquisition should be made only on the basis of the
information contained in the Scheme Document.
Additional information for US shareholders
The proposed acquisition relates to the shares of an English
company and is expected to be made by means of a scheme of
arrangement provided for under English company law. The proposed
acquisition will not be subject to the tender offer rules or the
proxy solicitation rules under the U.S. Securities Exchange Act of
1934, as amended (the “US Exchange Act”). Accordingly, the proposed
acquisition will be subject to the disclosure requirements and
practices applicable in the United Kingdom to schemes of
arrangement, which differ from the disclosure requirements of U.S.
tender offer and proxy solicitation rules. If, in the future,
Michael Kors exercises the right to implement the proposed
acquisition by way of a takeover offer, the proposed acquisition
will be made in compliance with applicable U.S. laws and
regulations, including Section 14(e) of the US Exchange Act and
Regulation 14E thereunder.
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version on businesswire.com: http://www.businesswire.com/news/home/20170724006359/en/
Michael Kors Holdings LimitedChristina Coronios,
201-691-6133InvestorRelations@MichaelKors.comorICR, Inc.Jean
Fontana, 203-682-8200jean.fontana@icrinc.comorMedia:ICR, Inc.Alecia
Pulman, 646-277-1231KorsPR@icrinc.com
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