Clothing brand licensing company
Iconix Brand Group Inc.
) has acquired the remaining 50% interest in Iconix Latin America
from its joint venture partner, New Brands Group, S.A. for $42
million in cash. Iconix had formed Iconix Latin America in Dec
2008 with 50% stake in the joint venture.
The decision to acquire the remaining 50% interest in Iconix
Latin America comes at the right time when the business in the
region is growing impressively. Since 2008, the company's royalty
revenue from its iconic brands has increased fourfold in the
region, particularly in Brazil, Mexico, Chile and across Central
Iconix seeks to monetize its brands through these
international joint ventures, which have contributed meaningfully
to the company's revenues. Besides Latin America, the company has
formed seven international joint ventures since 2008. In 2013,
the company formed four new international joint ventures in
Canada, Australia, Southeast Asia and Israel. Other previous
joint ventures include Iconix China, Iconix Europe and Iconix
New York-based Iconix has also acquired a number of brands and
formed domestic joint ventures in the recent past. The most
recent and accretive acquisitions were of Lee Cooper (Feb 2013)
and Umbro brands (Dec 2012). In Feb 2013, the company also formed
a joint venture with Buffalo International and expanded its
portfolio into Canada.
The company also purchased an approximately 14.4% minority
interest in Complex Media, a multi-media lifestyle company and
owner of Complex magazine and its online counterpart, Complex.com
in Sep 2013. In Jul 2013, the company purchased a 10% minority
interest in Marcy Media, which is a multi-media portfolio
company. In May 2013, Iconix acquired the remaining 49% interest
in IP Holdings Unltd LLC ("IPHU") and owns brands such as Ecko
Unltd. and Marc Ecko Cut & Sew.
With these joint ventures and global brands, the company's
international business contributes 37% of the total business, up
from 24% in 2012. For 2014, the company expects revenues from its
non-consolidated joint ventures to be approximately $44
We remain impressed with Iconix's strategic acquisitions and
consistent expansion of licensing agreements. Iconix expects to
explore additional opportunities and enhance its portfolio with
more iconic brands in the upcoming quarters. Iconix holds a Zacks
Rank #1 (Strong Buy).
Other Stocks to Consider
Investors interested in the consumer discretionary sector
Joe's Jeans Inc
Michael Kors Holdings Ltd
), all with a Zacks Rank #1 (Strong Buy).
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