Michael Kors buys back Michael Kors HK for $500 million
Michael Kors has paid $500 million in cash to acquire Michael Kors HK, the exclusive licensee of the company in China and certain other jurisdictions in Asia.
Approved by independent members of the company’s board of directors, the acquisition is subject to adjustment.
The greater China business generated total revenue of $197 million for the year ended March 31, with a network of 91 company-run retail stores and six travel retail locations across China, Hong Kong, Macau and Taiwan.
This fiscal year, the greater China business is expected to contribute about $200 million to retail net sales, reflecting sales for the 10-month period following the closing of the acquisition.
Michael Kors chairman/CEO John Idol says the company is excited about acquiring its greater China licensee. “We have worked diligently over the past several years with our licensed partner in this region to build the infrastructure, establish the brand and grow acceptance of Michael Kors in the Chinese market.
“We believe our brand is gaining strong momentum in greater China, making it the ideal time for us to integrate this territory into our business and capitalise on the enormous growth potential in this region.”