Heelys Inks New Merger Agreement

Two months after first inking an acquisition deal, Heelys Inc. has found another new buyer.

The latest deal, struck with Sequential Brands Group Inc., is worth roughly four times more than the previous one inked with Evergreen Group Ventures in October, and it will no longer require the company to be dissolved.

Sequential will acquire all the outstanding shares of common stock of the skate brand for $2.25 per share in cash, totaling about $63.2 million. Evergreen’s $14 million offer was for the operating assets and liabilities only.

Sequential has agreed to pay Evergreen the termination fee that its new agreement with Heelys has incurred.

Tom Hansen, Heelys’ president and CEO, said in a statement that this agreement is in the best interest of company stockholders.

“Their all-cash offer provides our stockholders with a fixed cash value and eliminates the need to proceed with the previously announced plan of dissolution,” he said.

William Sweedler, chairman of Sequential, said, “The Sequential model is simple: Find great brands and marry them with equally great operating licensees to build on their core DNA.”

Yehuda Shmidman, CEO of Sequential, added, “Heelys is recognized globally as a pioneer of skate shoes, and with its brand DNA rooted in innovation and skate, we see the potential for expansion in the future as a global lifestyle brand.”

To that end, Sequential, which also owns the William Rast, People’s Liberation and DVS brands, will shortly announce a long-term worldwide licensing partner for the core category of footwear, and Heelys’ management team.

Also as part of the merger agreement, Capital Southwest Venture Corp. has taken a minority stake in Heelys.

The deal is expected to close in the first quarter of 2013.

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