(Crocs) Shares of Crocs Inc. fell more than 15% on Thursday after the company announced it would acquire privately-owned casual footwear brand, HEYDUDE for $2.5 billion.
The transaction will be a cash deal of $2.05 billion, while the rest will be in the form of Crocs shares determined as an average of the daily weighted average for the last 20 days.
Crocs expects to acquire a $2.0 billion Term Loan B Facility to finance the deal, and borrow an additional $50 million under its revolving credit facility.
The transaction, which closes in the first quarter of next year, will see HEYDUDE exist as a standalone unit, with its founder Alessandro Rosano acting as the strategic advisor and creative director. He expects the deal with Crocs to take HEYDUDE to the next level.
Crocs CEO Andrew Rees says the deal for HEYDUDE adds a highly profitable brand, with its products aligned with the long-term trends in consumer markets.
CROX: NASDAQ is down -15.17%.
