Deckers Outdoor Corporation, the new owner of the Teva brand, has just signed two licensing agreements. One is with Capital Mercury to produce men’s apparel, and another with Outdoor Cap Company for headwear. BHPC Global Licensing finalized both of the deals for Teva. Distribution for the apparel and headwear will be in line with Teva’s at specialty outdoor retailers, sporting goods stores, as well as department stores.

According to the company, the apparel will reflect the same versatile design as their footwear line. Capital Mercury is responsible for the design, production, merchandising, and distribution of the apparel.

Alex Tomlinson, Director of Licensing at BHPC told SEW, “The merchandizing team at Capital Mercury will be working very closely with the design team at Teva.”

As hinted here in the OR Show report, retailers could see the line on their shelves as early as next year. “We are looking at a soft launch, a limited amount of product to some choice distributors in ’04, and ideally we will be seeing a full launch in spring of 2005”, said Tomlinson.

The headwear will follow the same launch calendar and design controls as the apparel. Outdoor Cap Company is currently a licensee for Major League Baseball, Minor League Baseball as well as many other notables.

“The Teva brand is highly visible in the outdoor market and we see a tremendous opportunity to make Teva headwear a leader in the industry,” said Paul Mahan, President and founder of the Outdoor Cap Company.

As SEW reported in November, Deckers completed the purchase of the Teva license from Mark Thatcher, the inventor of the original Teva Sandal, for approximately $62 million. As a result of the acquisition, Deckers owns all Teva assets including patents, tradenames, trademarks and all other intellectual property. The company expected the transaction to be accretive to net income by approximately $1.0 million, or $0.03 per share, for 2003. It already had a major impact on the company’s bottom line in Q2 2003, when DECK tripled earnings versus the year-ago period.

The move has impressed analysts thus far, with J.M. Dutton recently maintaining a “buy” rating on DECK.
Their report stated, “The Company's operating results in the first and second quarters were well above expectations… With Teva's future clarified, the Company is in a position to establish high-margin license arrangements in non-shoe markets to capitalize on the well-known and highly regarded Teva brand name.”

>>> The last go ‘round with a licensee through Thatcher’s former ownership did not fare so well. This time, Deckers has a stronger link to the brand and the licensee doesn’t have its own high-priority outdoor brand to sell…