Fossil has announced the acquisition of Skagen Designs, an international company known as a manufacturer of watches, clocks, sunglasses and jewelry. The deal is supposed to be finalized until the start of February. The total sum of money which was necessary to buy the private held brand is $236.8 million. The purchase includes about $225 million in cash and 150,000 shares owned by Fossil. According to the deal, if Skagen meets appointed revenue targets, it will get another 100,000 shares.
Though the design brand tends to use the name Skagen Denmark, its headquarters are, apart from Denmark, based also in Reno, Nevada and Hong Kong. The reason for the name of the brand is the fact that the company was founded by the Danish couple, Henrik and Charlotte Jorst. The Jorsts moved from Denmark to the USA in 1989 and started their own business which became the American sales representative for Comtech Watches which was a company from their native country that produced corporate gift watches.
Since the brand was manufacturing its products in Hong Kong, it was able to do it a substantially lower cost. At that point, the Jorsts decided to make a few designs for new watches by themselves. The initial products were presented in 1991 at a corporate gift event in New York and received acclaim from several major retailers. This was the turning point for the Danish couple who seized the opportunity and founded their own watchmaking brand, Skagen Denmark. The name of the brand derives from the small fishing village, famous for its long white sand beaches that became the inspiration for many painters during the 19th century. Some of these representations of Skagen’s renowned sceneries are even today sold by the most famous action houses. These lovely and pure designs, found on the canvases that depict Skagen, are the aesthetics that influenced the Danish-American couple. The Jorsts believed in recreating the same spirit on the products that could be bought at the very affordable prices. Nowadays, Skagen has its own retail stores not only in Denmark, but also in the United Kingdom and Hong Kong. Furthermore, its products are sold in 75 different countries in the world.
As the first reports indicate, the agreement was reached on mutual satisfaction. Fossil has a chance to enrich its collection with Skagen’s original designs which have earned quite a reputation for Nevada-based business. On the other hand, Skagen will also have new opportunities to prosper due to Fossil’s permanent intentions to expand and due to its financial strength.