Branded apparel maker VF Corporation will snap up The Timberland Company in an all-cash deal worth $2 billion, a move that would create a $10 billion apparel and footwear group. Both the firms have entered into a definitive agreement for the proposed deal.
The two firms said in a joint statement that VF will pay Timberland shareholders $43 per share, representing a total enterprise value of about $2 billion net of cash acquired. Timberland is a global footwear and apparel company with expected 2011 revenues of $1.6 billion.
Both the companies have presence in India. VF markets well known Wrangler, Lee, Nautica, JanSport and Kipling products through VF Arvind Brands Private Ltd. Timberland has a partnership with Reliance Brands, which is part of Mukesh Ambani-led Reliance Industries.
The transaction, expected to be complete in the third quarter, would add about $700 million to VF's overall revenues in 2011. Timberland would become part of VF's Outdoor & Action Sports coalition.