NEWS

Crocs to acquire footwear brand Hey Dude for $2.5 billion

By VARINDIA - 2021-12-25

Crocs said that it will acquire privately-owned footwear label Hey Dude for $2.5 billion. Of this, it will pay $2.05 billion in cash, while the remaining $450 million will be issued as Crocs shares to Hey Dude Founder and CEO Alessandro Rosano and Andrew Rees, Crocs CEO said that the acquisition of the Italian-origin company will be "highly profitable".

Crocs said it would pay $2.05 billion in cash, funded mostly by a term loan, and $450 million in Crocs shares issued to Heydude founder and Chief Executive Alessandro Rosano.Heydude has been a strong performer during the pandemic, albeit somewhat under the radar," Matt Powell, senior industry advisor of sports at NPD Group, said.

Heydude, founded in Italy in 2008, brings about 43% of its sales from online channels, Crocs said. The company, known for its lightweight casual shoes, is expected to make about $570 million in revenue in 2021.

In comparison, Crocs, which brings in 37% of its sales through its e-commerce division, in October forecast its 2021 revenue to grow 62%-65% from the $1.39 billion it recorded last year. Heydude has remained insulated from production constraints caused by factory closures in Vietnam, as it predominantly makes its footwear in China, Crocs Chief Executive Andrew Rees told analysts on a call.