Clarks agrees £100m rescue deal with LionRock Capital

Clarks has been rescued in a £100m deal with LionRock Capital – the Hong-Kong-based private equity firm.

Announcing its new partnership, LionRock Capital said it will acquire a majority stake in Clarks, with the Clark family to remain invested in the business.

The £100m investment will enable Clarks to “position the business for future long-term sustainable growth” and deliver its strategy to “revitalise” the footwear brand as it enters its third century in line with its ‘Made to Last’ strategy announced in May 2020.

The firm said the partnership will also enable Clarks to benefit from the “expertise” that LionRock Capital brings to grow the Clarks brand globally and most notably in China and across the rest of Asia Pacific.

It added LionRock Capital’s investment in Clarks will be subject to shareholder approval, and shareholders will be asked to vote on the proposed transaction in December. The investment is also subject to a CVA for its UK and Republic of Ireland businesses in relation to its store portfolio.

Clarks CEO Giorgio Presca said: “For nearly 200 years, Clarks has been a pioneer of shoemaking, inventing the casual shoe and delivering innovative and iconic shoes consumers love and trust. Underpinned by a rich heritage and strong values, today we are a leading global footwear brand serving millions of consumers across the world.

“Our new strategy, in conjunction with our new partnership with LionRock Capital will create a strong and sustainable future for this unique and iconic brand. Our strategy is designed to put the consumer at the heart of everything we do through a focus on brand segmentation and revitalising our brand communications, digital experience and product design to create consumer desire.”

He added: “The challenges to our business brought on by Covid-19 have meant that we need more resources and investment in order to fully deliver this strategy and safeguard the future of our business.

“The new partnership with LionRock Capital will provide this as well as the expertise to grow the Clarks brand in China, which remains a primary opportunity. Our people, partners and customers remain our top priority and we are committed to building a relevant, accessible and desirable brand that reflects the way consumers live their lives.”

Daniel Tseung, founder and MD of LionRock Capital, said: “Clarks is one of the world’s most recognised consumer names and we look forward to working with the Clark family in extending its tradition of providing customers with top quality products and exceptional service.

“We are extremely pleased to have the opportunity to partner with Clarks in expanding the company’s global operations and worldwide customer footprint. Our investment will not only strengthen Clarks’ position as one of the world’s most recognised brands, but also allow growth into key emerging markets.”