Movado completes MVMT acquisition
Movado Group announced on October 1 that it has completed its acquisition of MVMT Watches, the parent company of MVMT, providing the group with a global growth opportunity and exposure to millennial customers.
Movado Group has acquired MVMT with an initial payment of $100 million (approximately $85 million net of tax benefits) subject to closing adjustments. Two future contingent payments will also be made that could reach another $100 before tax benefits.
Future payments will be determined by MVMT’s future financial performance. Movado Group is funding the acquisition by cash on hand but expects to replenish its cash with around $50 million in borrowings by the end of the month.
Movado Group foresees the acquisition benefitting the business in several ways. Firstly, as MVMT’s watches, sunglasses, and accessories are priced accessibly, the brand has both aspirational and millennial consumers which Movado Group will now have access to.
According to Movado, MVMT also has a strong track-record of growth and in the last fiscal year ending December 31, MVMT reported revenue of approximately $71 million.
With this acquisition, Movado will use MVMT’s strong digital strategy to bolster its own and in turn MVMT will be able to benefit from Movado’s global infrastructure and distribution network to help it reach new markets.
“We are pleased to officially welcome MVMT to Movado Group having closed on this strategic acquisition,” said Efraim Grinberg, Movado Group’s Chairman and CEO in a press release.
“MVMT provides many benefits to our company – we add a strong digital brand to our portfolio; broaden our customer reach to millennials, an important consumer segment; and increase the sales and earnings potential of our company with an acquisition that we expect will be accretive to fiscal 2019 results.
"We expect to leverage the strengths of MVMT combined with our scale and operating platform to take the brand to a greater level of growth. With the closing of this acquisition, we are well positioned to capitalize on the full potential of our owned and licensed brands portfolio as we focus on delivering sustainable long-term growth.”
“I am excited to officially be part of the Movado team,” said Jake Kassan, Co-founder and CEO of MVMT. “The entire MVMT team shares in my excitement as we will now be able to benefit from the resources and brand expertise of Movado Group that will help MVMT achieve our long-term objectives.”
Movado designs, sources, and distributes watches for a number of brands worldwide including Coach, Hugo Boss, Lacoste, Ebel, and Rebecca Minkoff among others. The business also runs Movado stores across the US and Canada.
Copyright © 2021 FashionNetwork.com All rights reserved.