New York-based brand management company Iconix Brands, Inc. has announced the completion of the sale of its Starter China subsidiary to an unnamed buyer.
First announced in June of this year, the deal sees the company’s Chinese subsidiary, Iconix China Limited, part with all equity interests of Starter China Limited for $16.0 million.
The transaction includes the sale of the Starter sportswear brand in mainland China, Hong
Kong, Taiwan and Macau.
The deal comes on the heels of Iconix’s sale of Umbro China to HK Qiaodan for $62.5 million, which closed at the end of July, some eight months after Iconix CEO Robert Galvin, suggested in an earnings call that the group had been working with the “wrong partner” for the sportswear brand on the Chinese market.
According to the company, whose owned brand portfolio also includes Lee Cooper and Ecko Unltd., it plans to use the proceeds from both Chinese deals to repay amounts due under its existing financial arrangements, as well as for “general corporate purposes.”
In July, Iconix announced that it is currently considering a range of strategic alternatives for its business, including a potential sale of the company or a merger, as well a variety of recapitalization, financing and re-financing options.
Like many of its peers, Iconix has seen the Covid-19 pandemic take a heavy toll on its financial results. In the second quarter ended June 30, 2020, the company reported total revenues of $22.3 million, down 35% compared to the same period in the previous year.
The group’s quarterly net loss was $17.4 million, or $1.46 per share, compared to net income of $1.3 million, or $0.12 per share, in the prior year period.