Apr 26, 2017
UGG brand owner Deckers explores sale
Apr 26, 2017
Deckers Outdoor Corp said on Tuesday it was exploring strategic alternatives, including a sale of the company, a month after an activist investor urged the apparel and accessories maker to sell itself.
Deckers, the owner of the UGG brand of boots and apparel, said it had retained Moelis & Co LLC as financial adviser.
Shares of Goleta, California-based Deckers rose 6.5 percent to $62.53 in trading after the bell on Tuesday.
Red Mountain Capital Partners LLC last month pushed Deckers to explore a sale, saying the company's stock had underperformed across all major indices over the past three to five years.
In February, Marcato Capital Management LP, another activist investor, said it intended to discuss strategy and options with Deckers.
Red Mountain owns about 3.3 percent of Deckers' outstanding shares, while Marcato had reported a 6 percent stake in the company.
Sales of Deckers' sheepskin UGG boots, popular across U.S. cities, college campuses and malls, exploded to $1.52 billion in fiscal 2016 from just $37 million in 2003.
But growth has slowed, and Decker's share price has lost more than a third of its value since the end of 2014.
The company in February reported lower-than-expected third-quarter earnings, hurt by weak sales of the UGG and Sanuk brands, and also cut its revenue forecast for 2017.
Deckers is expected to report fourth-quarter results on May 24.
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