Steven Madden Ltd. is in at Superga and R.G. Barry Corp is out.
Long Island City, N.Y.-based Madden is the new exclusive distributor of Italian heritage athletic brand Superga in the U.S., Canada and Mexico.
Superga’s parent, BasicNet SpA, announced Friday that the agreement lasts three years and is renewable for a further four years.
According to Reuters Italy, Madden and BasicNet expect revenues of $24 million for the first three years, and plan to increase that to $95 million over the remainder of the contract.
Madden also has the option to open Superga-branded stores in conjunction with BasicNet. Superga last month bowed locations in Malaysia, Singapore and Vietnam, Reuters Italy reported.
“This important agreement is in line with our plan to develop the Superga brand in international markets,” BasicNet’s CEO Franco Spalla said to Italy’s La Repubblica newspaper.
Superga shoes retail from $65 to $100, and the brand has U.S. sales of more than $3 million, according to Sterne Agee, which declared the deal is a good fit.
“Steve Madden has been looking to do business with a fashion athletic brand and … we believe the Superga business will be a replenishment business in 2011 and a growth opportunity going in 2012 and beyond,” wrote Sterne Agee analyst Sam Poser in a research note. “We believe Steve Madden will look for co-branding opportunities with the Superga line and one or more of their licensed lines, as well as implement a growth strategy for the brand.”
Meanwhile, R.G. Barry’s distribution rights with Superga terminate at the end of the fiscal year in June. In a conference call with analysts last Tuesday, the company’s president and CEO, Greg Tunney, said Superga “had requested benchmarks that, quite frankly for us, would not allow us to achieve our performance.”
Tunney added that the brand “had negative impacts on our operating model this year, as well as the year before.” R.G. Barry also is exiting its Nautica license in June for failing to hit “goals of profitability and growth that we put in place.” Both licenses will potentially cost $3 million to $4.5 million in lost annual sales, he added.