Coach has agreed to buy handbag and accessories company Kate Spade for $2.4 billion in order to accelerate its growth. Under the terms of the deal announced on Monday, Kate Spade shareholders will still receive $18.50 per share in cash.
This acquisition will give Coach less competitors because Kate Spade, during those years, has introduces new products and also proved that she has a growing lifestyle business.
Thank’s to this purchase Coach wanted to unlock Kate Spade’s largely untapped global growth potential. Kate Spade has a truly unique and differentiated brand positioning with a broad assortment of lifestyle and strong awareness among consumers it’s why Coach doesn’t hesitates to buy this brand, it was such a good opportunity.
They are creating the first group focus on luxury lifestyle’s brand based in New York, marked by authentic and distinctive products, with innovation.
Coach also recently announced a partnership with the american singer, Selena Gomez.
The market is ripe for consolidation, which is partially what Coach and Kate Spade merger reflects, it’s about bringing together complementary brands.