Armed with a ton of cold-hard cash and seeing valuations on once hot retailers amid the COVID-19 pandemic crash, the always acquisitive owner of powerhouse retail brands The North Face, Vans, Timberland and Dickies is on the hunt for its latest big buy.
At this point in the Great Retail Shakeout of 2020, V.F. Corporation will have its pick of a fallen litter.
“M&A is the number one priority,” V.F. Corp. CEO Steve Rendle said on Yahoo Finance’s The First Trade. The company has taken steps to doing something big before yearend. It recently completed a $3 billion bond offering and with $2.2 billion open on a pre-existing credit facility, the company has total liquidity of more than $5 billion.
Rendle is no stranger to V.F. Corp.’s historically acquisitive nature, having joined the company in 1999 ahead of a major buying streak. In fact, buying well-known brands at a great value — and then scaling them up further globally — is a rite of passage of sorts for V.F. Corp. CEOs. Rendle’s predecessors Mackey McDonald and Eric Wiseman all had transformative acquisitions during their CEO tenures.
McDonald plunked down $396 million for skater lifestyle brand Vans in 2004 - the brand has since become a major growth driver worldwide. Wiseman purchased footwear maker Timberland for $2 billion in 2011 — performance has been spotty for the brand through the years, but it remains a household name and far better run under V.F. Corp’s ownership.
Rendle himself has proven he wants to keep the acquisition strategy alive. His first acquisition came late in 2017 with the $820 million cash purchase of Dickies.
“We will be opportunistic. We will look for those possible M&A transactions that will come through this environment, and we’ll do it around outdoor space and athleisure. We are intrigued by this work lifestyle element of the marketplace where our Dickies brand sits,” added Rendle.