Caleres is closing out the year with a big buy.
The St. Louis-based firm announced today that it has acquired U.S.-based men’s shoe brand Allen Edmonds from private equity firm Brentwood Associates for $255 million.
The nearly 100-year-old brand joins Caleres’ roster of men’s footwear labels, which includes Vince, Dr. Scholl’s and George Brown Bilt. (Caleres’s portfolio is predominantly women-focused and includes brands such as Diane von Furstenberg, Fergie, Via Spiga and Franco Sarto.)
In addition to adding a new revenue stream for the acquisition-focused brand management firm, Caleres CEO, president and chairman Diane Sullivan said the brand will become the “cornerstone” of the firm’s growing men’s business.
“Fundamentally and primarily Caleres has been a company that’s a wholesale portfolio of women’s brands — [men’s] wasn’t really a strategic focus for us,” Sullivan said. “We really saw that there was an opportunity not to cannibalize our women’s portfolio but to look for new growth and a new revenue stream against a totally different segment of consumers. We were looking for a great brand that has scale and size and that could be a cornerstone for a company, and Allen Edmonds just fit the bill.”
Sullivan said the firm spent several months meeting with the Allen Edmonds team before finalizing its decision to snap up the label.
“They have amazingly high brand equity and a loyal customer base — over 70 percent of their consumers said they would recommend the brand, which we thought was unheard of,” Sullivan said. “And 48 percent of their retail consumers were new to their brand — which means they’re also growing.”
According to Sullivan, scale was also a selling factor. While Caleres’ chief executive wouldn’t divulge the brand’s revenues, she noted that Allen Edmonds’ sales are “just slightly smaller than what our Sam Edelman business is.” (In 2015, Caleres said Sam Edelman delivered more than $100 million in revenues.)
Allen Edmonds’ footwear — the brand also added accessories and apparel to its offerings in 2013 — are handmade in Port Washington, Wis. The company has 70 stores in the U.S.
Sullivan said there are no plans to lay off any of the firm’s staff or key executives.
Paul Grangaard, the brand’s president and CEO, said the partnership with Caleres is an “ideal fit.”
“As part of the company’s brand portfolio, we’ll be sharing our men’s footwear knowledge and expertise, while simultaneously benefitting from the brand development, materials sourcing, product development and design capabilities inherent in a much larger footwear organization,” Grangaard said.