After months of speculation and at least one failed sale, Camuto Group could be getting closer to finding a new owner.
In a note last week, Susquehanna Financial LLLP analyst Sam Poser said he has gotten wind of a series of potential deals, which involve Authentic Brands Group (ABG) purchasing the firm founded by the late Vince Camuto and DSW Inc. becoming the licensee of Camuto’s footwear brands.
“We believe that DSW will likely buy the sourcing arm of the Camuto Group, either from Camuto Group itself or from ABG,” Poser wrote on August 17, adding that his industry checks indicate a ABG buyout of Camuto is likely to take place. “We do not know how much the acquisition will cost DSW, but our checks indicate that it will cost 33 percent of the Camuto Group’s total selling price.”
It has been mere weeks since ABG — owner and licensor for a range of lifestyle, celebrity and entertainment brands including Frye, Juicy Couture, Elvis Presley and Marilyn Monroe — reportedly beat out DSW to acquire the Nine West and Bandolino brands from their bankrupt parent firm. (In what was viewed as a full-circle moment for Nine West, ABG appointed Marc Fisher Footwear — the company launched by Marc Fisher, son of late Nine West cofounder Jerome Fisher — to run both brands’ shoe business.)
Watch on FN
But a marriage between DSW and Camuto Group, which owns the Vince Camuto and Louise et Cie brands and holds the footwear license for Jessica Simpson and Tory Burch, among others, is not likely to be the rebound either side may be looking for, according to Poser.
“DSW is a retail company, with plenty on its plate [and] wholesale is a different skill set,” Poser wrote.
Poser also cautioned that were such a deal to go through, retailers such as Nordstrom, Macy’s and Dillard’s, which do a “great deal” of business with Camuto Group brands, “will likely stop doing business because those retailers will be unwilling to provide data regarding what works and what does not work to a large competitor.”
Poser further speculates that Dillard’s would nix its private label development deal with Camuto in the wake of a supposed DSW partnership.
He also sees financial impediments to DSW’s ability to drive the sales needed to meet the minimum financial requirement built into an agreement with ABG.
Nearly a year ago, Camuto Group made headlines when it announced a blockbuster merger with privately held Canadian giant Aldo. Less than three months later, the deal — in which Aldo was to purchase the Camuto Group — was killed.
While the companies said that merger was scrapped after “careful consideration and thoughtful discussion” on both sides, executives inside the Greenwich, Connecticut-based Camuto told FN last month that they were disappointed.
“You always regret it if any transaction doesn’t come through in the end,” said Camuto CEO Alex Del Cielo in an FN story in July. “The hardest part was the time that it took. Let’s face it — we are all very busy at work. That’s every company in every industry. And when you’re doing a deal, you have something else taking time away from that. That’s always a challenge.”
Nevertheless, in recent months, the company has hired turnaround adviser Clear Thinking Group, made an aggressive entry into the kids’ market, launched a costume jewelry business and acquired Sole Society, a multibranded site offering women’s shoes, bags and apparel that expects to enhance its offerings.
Only time will tell whether Camuto will end up with ABG — and its footwear businesses with DSW — but Del Cielo said the company is open to deals and has had its share of suitors.
“Lots of people call us all the time,” he said in July.
But when it comes to his preferred buyer, Camuto’s chief has a preference.
“I think someone from the shoe industry is probably more appealing,” he said. “Strategic people have a longer-term view of things. But again, ultimately, our job is to get value for the shareholders.”
At press time, comments from Camuto Group were not available. ABG declined to comment for this story, and DSW did not respond to FN’s request for comment.