Publish Date : 27-Jun-2014
Sequential Brands Group, Inc. ("Sequential" or the "Company") announced today that it has signed a definitive agreement to acquire Galaxy Brand Holdings, Inc. ("Galaxy") for $100 million in cash, 13.75 million shares of common stock of the Company, and certain performance based warrants. This transformational acquisition will position Sequential as one of the largest pure-play brand licensing companies in the world, with a portfolio of twelve global consumer brands generating nearly $2 billion in global retail sales annually. The transaction, which is expected to close by the end of 2014, is subject to customary closing conditions and regulatory approval.
In the transaction, Sequential will acquire four well-known consumer brands that include the fitness brand Avia, basketball brand AND1, outdoor brand Nevados, and home goods brand Linens ‘N Things.
Galaxy currently has over 15 licensees with significant business at Walmart coupled with complementary distribution to a wide range of mid-tier and specialty retailers.
Yehuda Shmidman, CEO of Sequential, commented, "This merger is a game changer for Sequential, as it doubles the scale of our brand portfolio and further diversifies our licensee and distribution platform. We were attracted to these four brands for both their existing licensing base as well as the strong prospects for continued organic growth in the future."
"We are thrilled that this acquisition also brings the expertise of Eddie Esses and the Galaxy team who will continue to lead the business for the newly acquired brands," added Shmidman.
On a combined basis post-closing, the Company is projecting forward 12-month royalty revenues of $56 - $60 million and $36 - $40 million of Adjusted EBITDA from the total brand portfolio of 12 brands.
Eddie Esses, CEO of Galaxy Brand Holdings, stated, "I am excited about building upon Sequential's success and continuing to expand and strengthen our brands. The combination of our brand portfolios together as one unified force is very powerful."
Global alternative asset manager The Carlyle Group, which has a majority interest in Galaxy, will be granted one seat on Sequential's Board of Directors and will become a significant shareholder in the Company post-transaction.
William Sweedler, Chairman of Sequential, commented "The roadmap and execution playbook outlined approximately two years ago has been followed aggressively. I'm very proud of the Sequential management team and look forward to Rodney Cohen, Managing Director and Co-Head of Carlyle Growth Partners and Carlyle Equity Opportunity Fund, joining the Board of Directors."
Go to previous page
