Coach Inc. announced Monday that it will add Kate Spade to its portfolio of brands, besting rumored rival Michael Kors.
The company will pay $2.4 billion, or $18.50 per share. The long-speculated deal, which is expected to close in the third quarter of 2017, will be funded by $1.2 billion in cash, senior notes and bank term loans.
The deal follows months of speculation, further fueled by Kate Spade’s admission in February that it was exploring strategic alternatives. That development was sparked by one of the handbag company’s investors Caerus Investors, which submitted a letter to the board in November urging it to sell the company because profit margins were lagging behind its rivals’.
Read more at Sourcing Journal.