Canadian Tire buys Helly Hansen for almost C$1bn
May 10, 2018
Diversified retailer Canadian Tire Corp (CTC) is buying Norwegian outdoor brand Helly Hansen with the company saying it’s adding “a global brand and a leader in sportswear and workwear that professionals use and trust.” It’s paying C$985 million for the firm that also includes UK brand Musto.
CTC said the purchase supports its vision of becoming the top retail brand in Canada, strengthens its core outdoor and workwear businesses across multiple retail banners, accelerates its ability to distribute current and future owned brands internationally, and will be immediately accretive to CTC “with strong revenue and Ebitda growth trajectory”.
Founded in 1877, Helly Hansen is known for its professional grade and technical performance products developed for the harshest outdoor conditions. Its core categories are sailing, skiing, mountain, urban, rainwear and workwear.
With wholesale and retail distribution capabilities across more than 40 countries, Helly Hansen has strong global recognition and its core categories are also core to CTC's retail banners.
CTC also has a strong existing relationship with the brand via its Mark’s and FGL chains.
"For more than 10 years, Helly Hansen has been an exceptional fit with CTC and this acquisition will strengthen our assortment across all of our banners," said the Canadian firm’s chief executive Stephen Wetmore. "With our capabilities and Helly Hansen's trusted global brand and management team, we see tremendous opportunity in Canada and internationally.”
Helly Hansen’s own CEO Paul Stoneham said the deal “provides us with the ideal platform to further accelerate our growth trajectory and also strengthen our Canadian presence.”
The acquisition is expected to close in Q3 and, as mentioned, will be immediately accretive to earnings and cash flow even before the realisation of synergies. The transaction is not subject to financing conditions as CTC "has ample financial flexibility to fund the acquisition and to maintain its current investment grade credit rating.”
Stoneham and his team, based in Oslo, Norway, will continue to lead the business, reporting to CTC Executive VP Mahes Wickramasinghe.
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