Puma shares finished up 10% for the week on news that the company raised its 2003 sales growth outlook after it took direct responsibility for its Japanese footwear and accessories business. The new fully owned subsidiary, Puma Japan K.K., will start operations on April 1, 2003. Puma will continue its existing partnership with its Japanese apparel licensee, Hit Union.
The deal looks to be worth around 30 million ($32.4 million) and will be financed with cash on hand. The acquisition is expected to increase Puma’s top-line growth by an additional 10% in 2003, raising its currency-neutral sales increase to more than 30%. Pre-tax profits are also expected to grow in line with sales.
The new deal was made possible by the early termination of the license agreement with Hagemeyer N.V., a partnership that has been in place for 30 years.
