Levi’s to Acquire Assets from South American Distributor
Levi Strauss & Co. announced on Sept. 3 that it will spend more than $35 million to acquire all of the operational assets related to its Levi’s and Dockers brands from The Jeans Company. The company serves as Levi Strauss & Co.’s distributor in Chile, Peru and Bolivia.
The Santiago, Chile–headquartered TJC owned 80 Levi’s and Dockers retail stores as well as distribution for the region’s multi-brand retailers and logistical operations within these Latin American countries.
“Over the course of our 30-year partnership, TJC has enhanced the market position of the Levi’s and Dockers brands in Chile, Peru and Bolivia,” Roy Bagattini, president of the Americas region at LS&Co, said in a statement. “We believe the acquisition of these assets will build on the strong foundation established by TJC and position us to accelerate growth across the Andean region.”
Bringing Levi’s retail and logistical operations for Chile, Bolivia and Peru in-house will have an estimated impact of $20 million on Levi Strauss & Co., according to a Levi’s statement. The impact on revenue will be distributed evenly between the third and fourth quarters of the fiscal 2019 year. The company does not expect any similar impact in 2020.
“Deploying capital through organic acquisitions is a key part of our long-term strategy to become a world-class omni-channel retailer,” Harmit Singh, chief financial officer of LS&Co, said in a statement. “This transaction will further diversify our business, create operational synergies and enhance shareholder value.”
Latin America has historically been an important market for Levi Strauss & Co. Last year, it dramatically increased its presence in Mexico City. It also opened its first Latin American flagship in the Mexican capital in March 2018. The 10,000-square-foot flagship offers Levi’s lines such as its Made & Crafted and Levi’s Authorized Vintage collections.
“Opening this new store on one of Mexico City’s most iconic streets sets the Levi’s brand at the center of culture in Latin America,” Bagattini said in a 2018 statement.