logo-loader

Ted Baker shares creep up as it brings footwear back in-house with acquisition from licensee

Published: 10:30 10 Sep 2018 BST

Ted Baker shopfront
Since Pentland obtained the licence in 2001, division sales have risen more than 800%

Ted Baker PLC (LON:TED) shares ticked up in mid-morning trading Monday as it agreed to acquire No Ordinary Shoes Limited (NOS) from its footwear licensee Pentland Group PLC.

While Pentland currently holds an exclusive licence to manufacture and distribute footwear under the Ted Baker brand, the FTSE 250 fashion retailer said the purchase of NOS and its US sister company, No Ordinary Shoes USA, would bring the footwear division back in-house once it is completed at the end of 2018.

READ: Audit giant KPMG hit with £3mln fine for Ted Baker conflict of interest

The acquisition, financed by Ted Baker’s existing bank facilities, will cost £13mln plus an adjustment for net assets of NOS and NOS USA on the completion date, estimated to be between £4mln and £8mln.

The company added that the purchase was expected to be earnings enhancing from the 2019/20 financial year onwards.

In a note to clients, analysts at City broker Liberum upgraded their underlying earnings (EBITDA) estimates for the group by 5% for the 2020 and 2021 financial years, suggesting a three-year cash payback.

The broker added that the timing of the announcement, three months before its completion date, gave confidence to expectations of a “disciplined and thorough handover” as well as being long enough as not to disrupt “a peak selling period” for wholesales, which comprise 75% of the footwear business.

Ted Baker shares were up 0.8% at 2,188p.

Oriole Resources outlines 2023 achievements and future exploration plans

Oriole Resources PLC (AIM:ORR) CEO Tim Livesey and chief financial officer Bob Smeeton join Proactive's Stephen Gunnion with details of the company's 2023 financial and operational performance. Livesey highlighted successful exploration programs in Cameroon, at the Bibemi and Mbe projects,...

3 hours, 11 minutes ago