Nike (NYSE:NKE) is selling its Cole Haan brand to private equity firm Apex Partners for about $500 million in an attempt to decentralize its business. Earlier this year, the Oregon-based company announced a plan to sell its subsidiary Umbro to brand management company, Iconix Brand Group for $225 million. It declared its intention to focus on its own flagship brand, Jordon, Converse and Hurley.
Cole Haan was founded in 1928 as a men’s footwear store. Today it has outlets all over the country, making other products for men and women.
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The fashion retailer has helped Nike propel its growth in the past few years. But Umbro wasn’t as successful. It was sold to Iconix after facing tough competition from Adidas (ADDYY). Its revenue declined by 19 percent before it was sold.
Industry experts predicted that another private equity firm, TPG Capital Management will emerge as the winner among others vying for the deal. This is because a former chief executive of Cole Haan is now a senior advisor to TPG.
Apex clinched the final auction because of its business expertise. It runs strong brands such as Tommy Hilfiger and Phillips-Van Heusen.
Apex is expected to hire Jack Boys, a former chief executive at Converse, to run the company. When Nike bought Converse in 2003, Boys was the CEO.
Several news reports noted the deal could be reached as early as next week but might also fall through.
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