NIKE, Inc. today announced that it has reached agreement on an all-cash offer to
acquire Umbro plc, a leading United Kingdom-based global football (soccer)
brand with more than 70 years of experience in the world's No. 1 sport and
the world's biggest football market.
The Board of Directors of Umbro plc, which is listed on the London
Stock Exchange, has unanimously recommended that shareholders accept the
offer of 193.06 pence, which together with the declared dividend values the
company at approximately $582 million (285 million pounds sterling), or
approximately $4.00 (195 pence) per share.
"Umbro is a brand with a powerful heritage and deep experience in the
world's most popular sport and the world's biggest football market," said
Nike, Inc. President and CEO Mark Parker. "With its close links to The
Football Association and the England team, Umbro's future is even stronger
than its past. This dynamic alignment of Umbro and Nike, with our
complementary strengths and numerous ways to segment and grow the market,
will lead the game at every level throughout the world. We are fully
committed to helping Umbro reach its full potential, and we are delighted
that Umbro's board is unanimous in its support of our offer."
The acquisition will significantly expand Nike's global leadership in
football, a key growth category for the company. Since the early 1990s,
Nike has grown its football revenues from about $40 million to
approximately $1.5 billion and established brand leadership in the sport.
Umbro sells products directly or through licensees in more than 90
countries and has sports marketing relationships with many top football
players, teams and leagues, including the England national team. Umbro's
2006 annual revenues were approximately $276 million (149.5 million
pounds). Umbro reports that if licensed sales were translated to direct
sales based on wholesale cost, total wholesale equivalent sales were
approximately $755 million (409.4 million pounds).
Commenting on the agreement, Umbro CEO Steve Makin said, "This is an
excellent deal for all our stakeholders: it provides great value for
shareholders and exciting prospects for our colleagues, partners and
customers around the world. We will be a stronger and better business as
part of Nike and this deal will allow us to accelerate our existing growth
strategy by leveraging Nike's global resources and expertise. We look
forward to taking Umbro to new levels with Nike's support."
Brian Barwick, CEO of The Football Association, said: "The FA has
enjoyed an excellent partnership with Umbro for more than 20 years. We are
delighted that the proposed acquisition will allow us to continue our
strong historical relationship with Umbro while benefiting from the
marketing expertise and financial strength of Nike. Nike has provided firm
assurances that The FA relationship with Umbro will be protected and
enhanced, and we look forward to working closely with both companies moving
forward."
Nike intends to operate Umbro as a stand-alone affiliate brand, with a
focus on accelerating the brand's existing growth strategy. Similar to
other brands in Nike's portfolio, Umbro will benefit from Nike's product
research, design and development expertise, and supply chain and
distribution resources.
Source: Nike
Digg
Reddit
Slashdot