Wolverine Worldwide Shifts Strategy in China: Sells Stake in Merrell and Saucony to Xtep
Portfolio Pulse from Benzinga Newsdesk
Wolverine World Wide, Inc. (NYSE:WWW) has announced the sale of its minority ownership interest in the entity that owns Saucony's intellectual property in China and its equity interest in the Merrell and Saucony joint venture entities to Xtep. This strategic move, valued at $61 million, transitions the business from a joint venture to a license and distribution rights model, aiming to leverage Xtep's expertise in China and focus Wolverine Worldwide on global brand-building.
December 18, 2023 | 11:34 am
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Wolverine Worldwide has sold its stakes in the Merrell and Saucony brands in China to Xtep, transitioning to a licensing model. This strategic move is expected to simplify the company's business model, reduce costs, and strengthen its balance sheet, potentially leading to stronger returns for shareholders.
The sale of Wolverine Worldwide's stakes in the Merrell and Saucony joint ventures in China for $61 million is a significant strategic move that is likely to be viewed positively by investors. By transitioning to a licensing model, the company can focus on its core strengths of brand-building and product development. This could lead to cost reductions and a stronger balance sheet, which are typically seen as positive indicators for a company's stock price in the short term.
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