VF shakes up portfolio with Nautica sale
Greensboro apparel company VF continues shaking up its portfolio, with recent announcements it will sell the well-known Nautica brand and acquire Altra, a Utah-based running-shoe business with annual revenue of about $55 million.
New York-based Authentic Brands Group is buying Nautica for an undisclosed amount. The private-equity backed company’s brands include Aéropostale, Greg Norman and Juicy Couture.
The latest changes come in Steve Rendle’s second year as chief executive officer. Rendle, 58, took the reins in January 2017, replacing Eric Wiseman, a Wake Forest University grad who held the position for nine years. Company shares tripled during his tenure as The North Face brand, acquired in 2000 for $25 million, became a megahit with annual sales topping $2 billion. Before becoming CEO, Rendle had been president and chief operating officer since 2015. He’s been with the company since 1999.
VF bought Nautica for nearly $600 million in 2003, but the sporty brand, which rose to popularity in the 1990s before becoming an outlet-mall staple, has fallen out of favor. A partnership with 20-year-old rapper Lil Yachty, featuring a line of bomber jackets, hoodies and bucket hats, wasn’t enough to revive the brand, which had $428 million in revenue and lost $95.2 million in 2017.
“We came to a point where we thought perhaps it would be a better owner that could unlock the value that this brand holds,” Rendle said on a February conference call with analysts.
The recent moves follow VF’s $820 million purchase of workwear maker Williamson-Dickie last year, its first big acquisition in six years. The company also sold its licensed sports group, including the JanSport brand, to Jacksonville, Fla.-based Fanatics, and plans to buy Icebreaker Holdings, a New Zealand-based wool-apparel company, for about $204 million.
After reaching a record high in mid-February, shares of VF dropped more than 10% after it reported a fourth-quarter loss of $90.3 million. Federal tax-code changes prompted the company to take a $465 million charge in the fourth quarter. Despite the slump, shares in mid-March have gained about 40% in the last year and traded in mid-March in the $75 range.
Overall, 2017 revenue increased 7% to $11.8 billion, with VF’s top five brands — The North Face, Timberland, Wrangler, Lee and Vans — accounting for 81% of sales. The fastest grower was Vans, which reported a 19% gain in 2017.
VF also is focusing more on digital sales and its 1,518 brick-and-mortar stores. About 85% of its growth over the next few years will come from its own stores and online sales, rather than through other retailers, the company projects. In March, Rendle hired the company’s first chief digital officer, Velia Carboni, a former executive at Fidelity Investments.
THOMASVILLE — Old Dominion Freight Line named Greg Gantt chief executive officer, effective May 16. Gantt joined the company in 1994 and became president in 2015. Current CEO David Congdon will become executive chairman.
GREENSBORO — Baltimore-based Ameritox will close its local medical testing facility, idling 113 workers. The company is selling its assets and closing operations, according to a state filing.
GREENSBORO — Tencarva Machinery acquired Saladin Pump & Equipment, with locations in Beaumont, Texas, and Lake Charles, La., for an undisclosed amount. Tencarva, which distributes pumps and other fuel-handling equipment, employs 375 people in 10 states.
GREENSBORO — Honda Aircraft delivered 43 of its lightweight corporate jets in 2017, more than any other producer in its category. The company also began selling HondaJets in India.
HIGH POINT — Culp planned to acquire Read Window Products for an undisclosed amount. The Knoxville, Tenn.-based company makes and installs curtains, shades and other soft goods for Hilton, Wyndham and other hotels. Culp, which makes mattress and upholstery fabrics, had revenue of nearly $310 million in 2017.