SGB Executive spoke with Glenn Barrett, founder and CEO of insole maker OrthoLite, about the opportunities created for its flagship brand, Ortholite, and Cirql, its upstart featuring biodegradable foam, following its pending merger with London-based Coats Group Plc.
As reported, Coats reached a definitive agreement to acquire OrthoLite, based in Amherst, MA, for $770 million, including debt. The merger is aimed at “accelerating Coats’ strategy to create a ‘super tier 2′ supplier for footwear components.”
Coats, a global supplier of thread and structural components for apparel and footwear, posted revenues of $1.5 billion in 2024, up 8 percent year-over-year. OrthoLite’s sales totaled $258 million in 2024, up 18.9 percent. Based on last year’s results, the enlarged Coats Footwear division is estimated to have pro-forma revenues of $700 million.
Founded by Barrett in 1997, Ortholite “is the global market leader in open-cell foam insoles with a 36 percent share of the addressable market,” according to Coats’ financial documents. Supported by 14 production facilities, Ortholite reports it supplies over 500 million pairs of insoles a year to around 550 brand customers with more than 310 co-branding agreements.
David Paja, Coats’ CEO, said in a statement as the merger was announced on July 16, “The combination of Coats and OrthoLite is fantastic news for both companies and for the footwear industry. It brings together two global leaders in adjacent segments of the footwear components sector with a shared vision for innovation and sustainability and with unparalleled brands and customer relationships. We look forward to working with Glenn Barrett and the OrthoLite team, leveraging our combined strengths to reshape the future of the footwear components industry.”
The acquisition is expected to close in the fourth quarter.
SGB Executive: What drove the sale?
Glenn Barrett: The global footwear business continues to rapidly evolve, and merging with Coats builds more opportunities for us to best serve our customers. OrthoLite has always been driven to provide innovative product and supply chain solutions to the global footwear industry. Coats shares that vision and is the best fit for OrthoLite and Cirql.
SGB Executive: Why is Coats the right partner?
Barrett: It was important for OrthoLite to find the right buyers for its business, one that would be a strategic fit, understand how to innovate in the footwear business and one that shares our ongoing commitment to employees, customers and communities. Coats is the right fit for all of those criteria and will provide opportunities for continued investments in each. Therefore, we are confident that merging with Coats will support growth and expansion of OrthoLite.
SGB Executive: What does it mean for Cirql?
Barrett: Cirql will realize the same synergies from the scale, efficiencies and innovation investment from Coats as OrthoLite. We’re confident that Coats will enable Cirql to offer a deeper assortment of trusted, less-impactful footwear materials and components more quickly for our customers during a time when that is more in demand than ever before.
SGB Executive: Can you elaborate further on what the merger might mean for your 550 brand customers?
Barrett: OrthoLite is a highly complementary addition to Coats as a supplier of high-quality footwear insoles to multiple categories of the global footwear market. Coats and OrthoLite also share a commitment to building a more sustainable future for the footwear industry. The combination of OrthoLite with Coats Footwear provides more product, technology and innovation solutions as well as enhanced scale and capabilities to serve customers, many of which are shared.
SGB Executive: How is Ortholite’s overall business?
Barrett: OrthoLite is a fast-growing business, and we’re expanding the categories of footwear we serve. We have some exciting launches on the horizon in the near future. Stay tuned!
SGB Executive: How does it feel personally to sell Ortholite after 28 years building the business?
Barrett: It’s incredibly exciting to join forces with Coats Group PLC, bringing together OrthoLite, the company I started nearly three decades ago, and one of the world’s most respected industrial leaders. This partnership fuels our shared mission: to push the boundaries of innovation and sustainability in footwear for years to come.
Images courtesy Ortholite
