Skechers agrees to be acquired by 3G Capital for $8.2 billion

 

·       Skechers’ announcement of being acquired by 3G Capital (a private equity firm) for $63 per share is going to end its 26-year run on the public market soon.

·       Skechers’ ongoing valuation on the public markets obtains a 30% premium on the purchase price.

·       A source familiar with the deal said that Skechers couldn’t have endured oversees tariffs hike. On the other hand, high tariffs wouldn’t impact 3G Capital in the long term.

The retailer put out on Monday that Skechers, a footwear giant, has gone along with being acquired by 3G Capital, a private equity firm, for $63 per share. This acquisition would end three decades run of this footwear giant as a public company.

Skechers’ current valuation on the public market gets its hands on a 30% premium by the price 3G Capital agrees to put up, which is in line with similar takeover deals. Making the transaction public ends up closing Skechers’ shares up more than 24% on Monday.

Skechers is setting out to work in a partnership with the global investment firm 3G Capital, with a proven track record, Skechers’ CEO, Robert Greenberg, reported in a news release.

He added, “Our hardworking team with a lot of experts enacts their expertise to accomplish the requirements of consumers and customers while growing the great progress of the company for so long as historically advancing the great success for some global consumer businesses, and we believe this partnership will be strengthening our talented team.

A difficult period of time for the retail industry and particularly for the footwear sector brings about the happening of transactions. As it’s a fact that both the retail industry and the footwear sector hinge on discretionary spending and overseas supply chains that are now under massive impact from the White House’s tariff hike.

Footwear Distributors and Retailers of America wrote a letter to the White House last week, Skechers also signed onto that, asking President Donald Trump to repeal tariffs on shoes.

The macroeconomic uncertainty triggered Skechers to pull back its full-year 2025 guidance a week ago. This uncertainty came from global trade policy as consumers started to spend cautiously, which would result in an enormous impact on the footwear and apparel sectors.

China is currently dealing with 145% tariffs, and Skechers didn’t respond to how much they are importing from this high-tariffed country, but it cautioned that two-thirds of business is extended to the foreign countries, and therefore they predicted less impact.

Skecher didn’t make a deal due to a staggering trade environment, and though it was in the interest of 3G Capital for years to acquire it, a source close to the deal, who spoke on the condition of anonymity to talk about non-public details, said.

The uncertainty caused by tariffs holds out in the short term; however, 3G Capital forecasts that the long-term outlook of Skechers business isn’t unattractive and will be growing moving forward, the person said.

Following Nike and Adidas, Skechers is the third-largest footwear company in the world.

Though the acquisition will be completed, Greenberg will hold his position as Skecher’s CEO and keep on laying out company’s the strategy.