WORLD FOOTWEAR
SEPTEMBER/OCTOBER 2011
“The Timberland brand has a good foothold in China and is
about half the size of the North Face business there. The
Timberland brand resonates well in China and we look
forward to leveraging our big Asia-based platform to
continue the brand’s strong growth there.”
Decision time
Timberland has received interest from potential buyers for
the past decade, but decided to go ahead with VF’s offer for
the sake of the shareholder, according to Mr Swartz. “The
principal issue… is what’s good for the shareholder,” he
said. “Our Board concluded that the time is right because this
serves our shareholder in a unique and special way.” Mr
Swartz described the acquisition as “magnificent and
bittersweet”. “I believe we have done what’s right for our
shareholder and that had to be not our first concern, it really
had to be our only concern. And I think at the end of the day
that’s what we’ve done. We’ve rewarded the faith of our
shareholders’ belief in the value of the brand.”
For VF, its own financial strength made the acquisition an
attractive one. “VF Corporation has admired the Timberland
brand and management team for a long, long time,” said Mr
Wiseman. “And I can say with confidence it goes back at
least one decade and maybe more where our management
teams have occasionally been connected on talking about
strategic opportunities. What made this opportunity unique
now are several things. One of course is the financial
strength of VF at this moment in time. Another is we have
platforms in place – if you go back say five years and look at
where VF was, there were places where we could definitely
add value to this business.
“For example, China, we’d have a large and rapidly
growing business in China. And we think that that platform
can help enable Timberland’s success. They are already
there. We think it can be an accelerant to their success in
China. That didn’t exist five years ago.
“The other important piece is the fact that the Timberland
brand and the Smartwool brands both have substantial
momentum right now and great platforms of their own in
places like Japan where we are much less well-developed,
so there are opportunities there. Both businesses have
complementary momentum and capabilities, and it’s the
right time to put the two together.”
During the conference, some analysts expressed concern
about The North Face and Timberland co-habiting under the
same umbrella – suggesting that “cannabalisation” could be
an issue for the two brands. Mr Wiseman responded to the
suggestions by reiterating VF’s stance that the deal is a
“complementary acquisition”. “If you think about the
Timberland brand, it is positioned differently than The North
Face,” said Mr Wiseman. “One way to think about it is kind
of below the tree line and above the tree line; another way
to think about it is the activities – we worry a lot about
activity-based brands, the activities that the Timberland
brand users normally participate in are – I call them lower
heart rate activities versus the adrenaline rush of some of
The North Face equipment priorities. So they are different.
“The other big point is that 75% of the Timberland brand
is anchored in footwear. That’s not where The North Face is.
So we think this is largely complementary.”
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Timberland's outdoor footwear has an international presence and has always attracted interest at outdoor trade show, Ispo.
CREDIT:
MARTIN HANGEN/ISPO