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 Breaking Headlines


FEBRUARY 01, 2006 -- Walking Co. Acquires Steve's Shoes

The Walking Company, a wholly owned subsidiary of Big Dog Holdings, announced that it has agreed to acquire substantially all the assets of Steve's Shoes, Inc. for approximately $4.2 million in a bankruptcy auction.

Steve's Shoes, one of the largest independent comfort shoe retailers in the country, operates 45 stores in 22 states, primarily in the Mid West, under the store names Steve's Shoes, Overland Trading Co., and Sole Outdoors. Brands include Ecco, Dansko, and Merrell, among others, with total annual sales of approximately $35 million. Steve's Shoes was founded 67 years ago and grew from one store in Kansas City to 78 stores across the nation. As a result of their aggressive expansion and other factors, Steve's Shoes eventually declared bankruptcy a few weeks ago. The Walking Company has agreed to acquire at least 35 of the stores and has retained the right to accept, assign or reject the ten remaining stores after a 90-day trial period.

Andrew Feshbach, Chief Executive Officer, stated, "This is a good add-on acquisition for us, further implementing our expansion strategy for The Walking Company. We look forward to converting these stores to Walking Company stores. We will immediately bring financial strength to the organization and look to achieve significant operating leverage and cost savings by more fully utilizing The Walking Company's systems, distribution infrastructure, and experienced management team."

PUMA North America announced that Johnny Damon, the new centerfielder for the New York Yankees, has signed with the global athletic brand for another four years. Damon has been with the PUMA brand since 2003.

As part of PUMA's relationship with Damon, the All-Star athlete will continue to represent the brand on the field wearing PUMA DFR cleats. He will also participate in various marketing projects and appearances on behalf of the brand.

To celebrate the partnership, Damon will be presented with a Ferrari as a gift from PUMA in the Ferrari Corporate Showroom in New York City. Since 2005, PUMA has been the official licensee of Ferrari replica and fan apparel and accessories.

"Johnny has always been a perfect representation of the PUMA brand. His performance at the plate and in centerfield has always impressed us. Match his baseball skills with his style and personality, and you have the right mix of sports and lifestyle that is PUMA," said Jay Piccola, President and General Manager for PUMA North America. "We are thrilled to continue supporting Johnny as he takes on a new challenge with a new team."

"Ever since we started working together, PUMA has always provided me with the support and encouragement I needed. PUMA has let my lifestyle and performance speak for itself and I'm honored to have them by my side in New York as I take my career to new heights," said Damon.

Lowrance Being Acquired For 48% Premium

Simrad Yachting has agreed to acquire all of the outstanding shares of Lowrance Electronics or $37 per share. The acquisition price represents an enterprise value for Lowrance of approximately $215 million and a premium of 48% over the closing price of its shares on Friday, January 27.

Under the terms of a merger agreement entered into by the parties, Navico Acquisition Corp., a newly formed wholly owned subsidiary of Simrad Yachting, will commence a cash tender offer for all of the outstanding shares of Lowrance at $37 per share and will complete a second step merger at the same price. The tender offer will be subject to a majority minimum tender condition and other customary conditions, but will not be subject to any financing conditions. After the tender offer and the merger, Lowrance will become a wholly owned subsidiary of Simrad Yachting.

The board of directors of Lowrance has unanimously approved the merger agreement, tender offer and merger and recommended that Lowrance's stockholders tender their shares into the tender offer.

Lowrance is one of the world's largest providers of marine electronics to leisure boats and has a particularly strong presence in the fish finders and GPS navigation systems segments of the market. In addition to marine electronic products, Lowrance has produced for over 10 years hand-held GPS mapping products for campers and hikers, as well GPS navigation systems for the automotive and aviation markets.

Simrad Yachting is a leading provider of marine electronics to high-end leisure boats and smaller commercial vessels.

The NBA released a list of the top selling NBA player jerseys sold in China that showed Tracy McGrady topped local hero Yao Ming. The rankings are based on sales from retail locations across the country as of November 2005. Reebok is the official provider of NBA jerseys in China.

1) Tracy McGrady, Houston Rockets
2) Allen Iverson, Philadelphia 76ers
3) Yao Ming, Houston Rockets
4) Kobe Bryant, Los Angeles Lakers
5) LeBron James, Cleveland Cavaliers
6) Carmelo Anthony, Denver Nuggets
7) Kevin Garnett, Minnesota Timberwolves
8) Shaquille O’Neal, Miami Heat
9) Steve Nash, Phoenix Suns
10) Dwyane Wade, Miami Heat

The NBA’s relationship with China dates back to 1979 when the Washington Bullets (now Wizards) played two exhibition games against the Chinese National Team. Currently, NBA games are telecast on 24 television stations in China, watched by more than 30 million viewers per week, and NBA.com/China averages over three million page-views per day. NBA merchandise is sold in more than 20,000 locations in China and the league has 13 official marketing partners in the country.

The NBA has teamed up with Spalding to design a new limited edition basketball that will commemorate NBA All-Star 2006 taking place in Houston Feb.17-19. The ball, which features the host city's team colors and the All-Star logo, will be used during the McDonald's All-Star Celebrity Game presented by NBA 2K Sports, the T-Mobile Rookie Challenge, and the events during NBA All-Star Saturday Night presented by AOL.

The All-Star ball will feature alternating panels of red, white and silver along with the 2006 NBA All-Star logo. The limited edition ball will be a collector's item with a total of only 2,006 being made available to fans. The ball, which retails for $95, will be laser-engraved with an identifying number (i.e. 1 of 2,006) along with the words “Limited Edition” and the Houston All-Star secondary “State of Texas” logo.

The ball, the second in a series of All-Star basketballs used each year incorporating the host city's team colors is currently available at the world's only NBA Store on Fifth Avenue in New York City and on NBAStore.com. Beginning Thursday, Feb. 16, fans will be able to purchase the limited edition ball at the NBA Store at NBA All-Star Jam Session presented by Nokia in Houston's George R. Brown Convention Center, as well as at the Toyota Center Team Shop during All-Star 2006.

“After the successful debut of the Limited Edition All-Star Ball in Denver last year, we thought it was important to offer fans the opportunity to commemorate the All-Star Game again this year,” says Brian Keegan, NBA Senior Director of Apparel, Sporting Goods and Basketball Partnerships. “With only 2,006 balls available, the NBA and Spalding have created a collectible item that will represent All-Star memories for fans and players alike for years to come.”

Pelican Products named John Chesen as Director of International Sales. He will be responsible for leading Pelican's sales in East and South Asia, Latin America and the Caribbean. Prior to joining Pelican, he served as Senior Director of the Northeast Asia office, based in Tokyo, Japan for PanAmSat, a leading provider of satellite-based international broadcasting and telecommunications services. During his tenure there, Chesen led a sales team that increased revenue by 25% annually and worked to expand satellite services to include direct-to-home television. Most recently he served as the Director of Strategy and Innovation Practice for the Corporate Executive Board, a leading provider of research, education and consulting services to senior-level executives at Fortune 1000 companies.

“I'm confident that John's global sales experience will take our international sales division to new levels and that his hands-on cultural and business experience will be an invaluable asset to our whole sales team,” said Scott Ermeti, Pelican Products' Vice President of Marketing and International Business Development.

SmartWool announced that Jim Markley is retiring as of Director of Sales after ten years with the company. SmartWool was recently acquired by Timberland, a milestone that represented the “perfect time to step away,” according to Markley. “It’s been a great run,” he said. “The brand was under a million dollars in sales when I took over in 1996 and we had a fraction of the SKUs we have today. The company’s success was very satisfying, but the best part of working for SmartWool has been the people. I am a far better person today because of the opportunity that I had to work and get to know everyone at SmartWool and their families.”

Jack Smith, founder of The Sports Authority, has joined the board of directors of I-trax, Inc., a leader in integrated health and productivity management. Smith founded The Sports Authority in 1987 with the opening of its first store in Ft. Lauderdale, Fla. As the former chairman and chief executive officer (CEO) of The Sports Authority, Mr. Smith took the company through its initial public offering in 1994 on the New York Stock Exchange and continued to lead the company until his departure in 1999. Prior to starting The Sports Authority, Smith served as the chief operating officer of Herman's Sporting Goods.

REI Announces 2005 Vendor Partnership Award Winners

Eagle Creek, known for its popular line of premium travel gear, received top honors as REI's Vendor Partner-of-the-Year.

"Eagle Creek has proven its leadership in active travel gear over the decades with category leadership, quality products and superior service to the outdoor market," said said Matt Hyde, REI's senior vice president of merchandising and logistics. "Because of the relevance of its products to REI customers, Eagle Creek has steadily grown a significant business and has helped REI's leadership position in the rebounding travel goods business."

The other 2005 vendor partnership award winners are:

*Camp/Travel Division Winner: KELTY;
*Action Sports Division Winner: Black Diamond Equipment Ltd.;
*Outdoorwear Division Winner: Keen Footwear.

Other vendor partnership award nominees included Garmin, Hind, Jetboil, Life is Good, Native Eyewear, The North Face, Royal Robbins, Salomon, Todson and Vasque.

Past recipients of the REI Vendor Partner-of-the-Year award include Yakima (1993), Black Diamond (1994), Vasque (1995, 1996), Bell Sports (1997), Columbia Sportswear (1998), Atlas Snowshoe (1999), Eagle Creek (2000), Cascade Designs (2001), Smith Sport Optics (2002), prAna (2003) and Keen Footwear (2004).

Zumiez Inc. announced that total net sales for the four-week period ended January 28, increased 46.3% to $12.9 million, compared to $8.8 million a year ago. The company's comparable store sales increased 23.2% for the past month, versus a comparable store sales increase of 17.2% in the year ago period.

Golf Galaxy, Inc. Announced the opening of its 16th new store during its 2006 fiscal year, which ends February 25. The new store, located in Newport News, Va., marks the retailer's 50th specialty golf store in the U.S. The Newport News Golf Galaxy store opens to the public in February. During Golf Galaxy's 2007 fiscal year, which begins on February 26, the company plans to open between 14 and 16 new stores.

Gildan Activewear Inc. reported first quarter net earnings of U.S. $16.2 million and diluted E.P.S. of U.S. $0.27, up 92.9% from net earnings of U.S. $8.4 million, or U.S. $0.14 per share, in the first quarter of fiscal 2005. E.P.S. was in excess of the Company's guidance of at least U.S. $0.23 per share, which it had provided on December 1, 2005, and was a record for the first quarter of a fiscal year. Sales in the first quarter, which is seasonally the lowest quarter in the fiscal year for the T-shirt business, amounted to U.S. $120.3 million, up 10.4% from U.S. $109.0 million in the first quarter of last year.

The increase in net earnings and E.P.S. was due to continuing strong growth in unit sales volumes and higher gross margins, partially offset by higher selling, general and administrative and depreciation expenses. The increase in sales revenues primarily reflected a 14.8% increase in unit sales volumes, partially offset by the impact of a lower-valued product-mix. Net selling prices were marginally higher than last year.

New Balance Performance Outerwear, the newest licensee of New Balance Athletic Shoe, Inc., has teamed with Nano-Tex to fuse fashion and performance in its new, vintage-inspired Circa V outerwear line. The new line features Nano-Tex Outdoor, a super durable water repellency treatment.

Circa V was inspired by exploration heroes of yesterday, featuring authentic silhouettes and sturdy, high-count cotton material to give the line real retro appeal. The advanced water repellent technology ensures that consumers will stay warm and comfortable while protecting them from outside elements.

"Even the most adventurous outdoor enthusiast has to come down off the mountain once in a while," said Shannon Hayward, vice president of sales and marketing for New Balance Performance Outerwear. "Circa V brings an urban sense of style to these nostalgic pieces that have been designed with true to the day silhouettes and trims."

New Balance unveiled the Circa V collection at the Outdoor Retailer Winter Market Show, January 28-31, 2006, in Salt Lake City. The line will be available at retail stores starting in fall 2006. Suggested retail prices range from $130 to $280. The collection includes nine styles of men's and women's parkas, puffer coats, bomber jackets, down vests and Bog coats. Colors range from vintage hues of red, orange, tan and powder blue, to chocolate, cream, purple and forest.

S&P analysts are lowering their recommendation on Timberland as it is trading at about a 10% premium to the 12-month target price of $32 (which S&P is maintaining). S&P sees no positive near-term catalyst to sustain recent momentum and anticipates a sell-off following the 4Q results announcement. S&P estimated 4Q sales flat at $452 million and EPS of 58 cents vs. 64 cents. It also sees increased competition in '07 when Wolverine launches its Patagonia footwear collection.


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Mergers & acquisitions

Walking Company
All-Star Inc.
NBA Store
PUMA North America
Lowrance Electronics Inc.

tender offer
leading provider
Division Winner
vendor partnership award
owned subsidiary

Johnny Damon
Jack Smith
Andrew Feshbach
Tracy McGrady
Yao Ming

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