Professional Documents
Culture Documents
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Spyder Sells to APAX for $100 Million
l July 26, 2004 Apax Partners announced it would acquire 80%
of Spyder’s equity for a company valuation of approx. $100
million.
l Bank One Corp. and Key Bank Corp. provided senior debt financing,
while Antares Capital Corp. provided mezzanine debt.
l Spyder rejected a slightly higher offer from a strategic buyer.
l CHB Capital Partners was paid out completely.
l Dave and his equal partner Shimokubo retained some ownership.
Jake and the other employees sold some of their ownership (but
not all).
l Dave retained his position as CEO, but planned at some point to
move to Chairman and appoint Jake as CEO. John Walbrecht left
the company.
Implied EV based on Apax Transaction $100,000
Implied 04 Sales Multiple 1.6x
Implied 04 EBITDA Multiple 10.7x
Implied 05 Sales Multiple 1.2x
Implied 05 EBITDA Multiple 7.3x
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Partnering with a Financial Buyer
“We are excited to join with Apax Partners at
this stage of Spyder's growth. Apax Partners has
a great track record and tremendous expertise
and relationships in the retail and consumer
sector. This will be helpful as Spyder pursues
new opportunities to broaden our product line to
include multiple seasons and other action sports,
all while remaining focused on our core high-end
customer.” quote from Dave Jacobs
Apax has also invested in Tommy Hilfiger, Phillips-Van Heusen, Tommy Bahama, Dollar Tree Stores
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CHB Realized a Gross Fund IRR of 55%
l “Believe it or not, the forecast this week calls for snow,
signaling the start of ski season. This season will be
different from previous years for us as we recently
completed the sale of skiwear company Spyder Active
Sports to Apax Partners. Since CHB’s investment in
September of 1997, Spyder has made extraordinary
progress, growing revenue from approximately $10
million to over $85 million. With the sale of Spyder, CHB
Capital Partners I is fully realized, with a gross fund IRR
of 55%.” Fall 2004 from CHB website
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April 2005 Outdoor Business Interview
l OB: “Why didn't you go with a strategic partner?”
l Dave Jacobs: “It ended up in a way being a bidding war between VF
Corp and Apax. I chose a financial partner. It's hard to say why and I
don't want to say anything bad about VF. I guess the difference is the
strategic partner will look for synergies. They'll combine things, which
makes sense because they've got to maximize their investment. The
have to reduce costs by combining some of the Spyder functions with
some of the other functions in other companies they have. And I
thought that was a little bit early in Spyder's growth to start doing
that because Spyder's got a great culture. Boulder, Colorado's a great
place, although VF was never talking about moving it. I just thought I
might as well take the opportunity at least in the next cycle with the
current buyers, which is probably a 3-to-5 year investment with them.
And I'd rather keep my whole company intact with this team and grow
it to the next step, and then maybe in the next cycle, a strategic will
buy it. But I thought it was a little bit early.”
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Spyder: What Happened?
Spyder’s product mix has grown to dominate ski racing, alpine, freeski, and
accessory categories, as well as a newly introduced downhill mountain
biking-inspired Spring Freeryde collection.
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Spyder: What Happened?
l 2006 Jake took over as President and CEO.
l February 2008 Spyder acquired outdoor and
mountaineering clothing maker Cloudveil
Mountain Works Inc.
l The target was sold by Cerberus Capital Management LP portfolio company
Sports Brand International LLC. The deal gives Spyder a product line outside the
ski market, helping it build a year-round business. Cloudveil produces technical
outdoor and mountaineering clothes such as parkas, vests, pants, gloves and fly-
fishing waders.
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Spyder: The Latest
l August 2013 Authentic Brands Group, LLC Completes Purchase of
Spyder Active Sports, Inc. Authentic Brands Group, a licensing
company that is connected to private equity firm Leonard Green &
Partners.
l Authentic Brands Group then sold the operating component of
Spyder to Li & Fung’s U.S. division. Authentic Brands keeps the
intellectual property.
l ABG brands include Marilyn Monroe®, Judith Leiber®, Juicy
Couture®, Adrienne Vittadini®, Taryn Rose®, Hickey
Freeman®, Hart Schaffner Marx®, Palm Beach®, Misook®,
Spyder®, Prince®, Ektelon®, Viking®, Bobby Jones®,
TapouT® and Sportcraft®.
Press Release
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Strategic License Partnership
with LF USA
l In connection with the acquisition, ABG and LF USA have entered into a
partnership that establishes LF USA as the exclusive licensee partner in
North, South, and Central America, Europe, the Middle East and Africa for
all current in-market and footwear products bearing the Spyder brand. In
addition, LF Asia will act as lead agent to identify best-in-class partnerships
for the brand in all product categories in the Asia Pacific market.
l About Li & Fung Limited
Li & Fung Limited (SEHK:494), the Hong Kong-headquartered multinational group, is
recognized as the world's leader in consumer goods design, development, sourcing
and distribution. It manages the supply chain for retailers and brands worldwide with
over 300 offices and distribution centers in more than 40 economies spanning across
the Americas, Europe, Africa and Asia. Through its three interconnected Business
Networks – Trading, Logistics and Distribution – the Group offers a spectrum of
services that covers the entire supply chain end-to-end.
l Global Brands Group –Brands: Calvin Klein, Frye, Rachel Zoe, Spyder, Coach, Juicy
Couture and Cole Haan. Retailers include Walmart, Amazon, Nordstrom and Macy’s in
the U.S., Primark and Selfridges in the U.K. as well as Lane Crawford in Asia.
Press Release
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Impact of Market Conditions on Spyder
Valuation in 2004
Middle-market M&A madness
l 2004 Trends - Up to 100 bidders vying for one small
company; more than a dozen financial advisers in a
bake-off; purchase price-EBITDA multiples of up to 13x;
debt-to-EBITDA multiples of 6-6.5x. Secondary buyouts,
the change of control from one private equity firm to
another, became commonplace.
l Cause of the madness?
l Arebounding economy, pent-up demand, limited
supply and a huge private equity capital overhang all
converged with a buoyant debt market to break the
long dry spell in M&A.
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Other M&A Activity
l August 2005 Adidas-Salomon AG bid €3.1 billion ($3.6 billion) for
U.S. sneaker maker Reebok International Ltd. to double its North
American sales.
l That sparked speculation that Nike Inc., the world's largest athletic
apparel maker, would bid for Germany's Puma AG (never materialized).
l April 2006 Russell Corp. agreed to sell out to Warren Buffett's
Berkshire Hathaway Inc.
l Transaction value –$1 billion in cash and assumed debt (a premium of
35% - 15.8x forward P/E). The stock had been plagued by a series of
profit warnings, due to weak retail sales in the wake of Hurricane
Katrina.
l March 2006 VF Corp. ($6B market cap) agreed to buy San Diego-
based Reef Holdings Corp. from LBO firm Swander Pace Capital.
l Reef: $75mm sales, $10mm Ebitda, $172 million purchase price (11x
Ebitda. There were multiple bidders, VF won the deal by expediting the
purchase and signing the deal within 3 weeks.
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