Vera Bradley completes acquisition of Pura Vida
American bag and luggage company Vera Bradley, Inc. announced on Tuesday that it has completed its acquisition of a 75% interest in Creative Genius, Inc., a digitally native jewelry brand which also operates under the name Pura Vida Bracelets, for a cash consideration of $75 million.
First announced last month, the transaction was funded by Vera Bradley’s existing available cash, cash equivalents and investments, and is expected to be accretive to the company’s earnings in fiscal 2020.
The deal also includes up to $22.5 million in incremental earnout cash consideration, which is subject to a range of performance-based targets set for calendar year 2019. Vera Bradley will be able to acquire the remaining 25% of Pura Vida in five years’ time.
As a subsidiary of Vera Bradley, Pura Vida, which reported revenues of $68.3 million in fiscal 2018, will continue to operate out of its current headquarters in La Jolla, California. Co-founders Griffin Thall and Paul Goodman will also maintain their leadership roles as CEO and CFO, respectively.
Vera Bradley believes that the two companies are “highly complementary businesses” that share an engaged and loyal multi-generational customer base.
“Pura Vida is a terrific fit for Vera Bradley as we move into the second phase of our Vision 20/20 three-year strategic plan and focus on growth,” explained Vera Bradley CEO Robert Wallstrom in a release. “The acquisition will grow revenues, expand our customer community, and diversify our business, which we believe will result in increased shareholder value.”
Wallstrom further pointed out that he hopes Vera Bradley will learn from Pura Vida’s “expertise around digital marketing and social customer engagement,” while Pura Vida will benefit from being able to “leverage [Vera Bradley’s] infrastructure and back office support capabilities.”
Vera Bradley reported $416.1 million in revenue in the fiscal year ended February 2, 2019. Forward-looking guidance including Pura Vida’s operations will be provided with the company’s second-quarter earnings report, which is scheduled for September 4, 2019.
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