North Face — outerwear maker to the Hip Hop and hiker nations — was bought by VF Corp. yesterday, the day after the money-losing company said it might file for bankruptcy.
VF, the world’s largest apparel company and maker of Wrangler and Lee jeans, agreed to buy North Face for a total of $155.4 million. That breaks down to about $25.4 million — $2 a share for all of the struggling camping-gear maker’s 12.7 million shares, and $130 million in assumed debt.
Two years ago, the camping company was to be taken private in a $213 million deal, which fell through when the buyers learned North Face would have to restate glowing 1997 and 1998 numbers.
Its revised earnings for 1998 were 62 percent lower than originally stated.
And it’s been downhill ever since, with North Face posting losses for the past three quarters and its execs stating this week that it was having problems meeting its financial needs.
Analysts liked the deal. The North Carolina-based VF Corp. makes Lee and Wrangler with 26 percent of the U.S. jeans market, Jansport, which is No. 1 in backpacks, Jantzen swimwear, and Vanity Fair lingerie.
VF shares fell 94 cents to $24.13, North Face rose 72 cents to $1.94.