Crocs, Inc. recently announced closing an investment from a Series A fund affiliated with Blackstone to purchase $200 million of newly issued “Preferred Stock.” The casual footwear company plans to use the proceeds from the Preferred Stock to fund the $350 million stock repurchase authorization approved by the company’s board and directors.
Crocs Inc. also appointed two new members and accepted the resignation of two current board members.
“We welcome Prakash [Melwani] and Gregg [Ribatt] to our board and are confident they will add a great deal of value through their branded consumer goods, retail, and financial experience,” said Thomas J. Smach, Crocs chairman of the board. “Although Blackstone’s investment will represent approximately 13% ownership at closing, we believe our company, shareholders and employees will benefit from 100% of Blackstone’s focus, global resources and expertise. This transaction provides a fantastic opportunity for our shareholders to participate alongside Blackstone and benefit from its efforts to deliver compelling shareholder value.”
As a condition of its investment, Blackstone, one of the world’s leading investment and advisory firms, was entitled to nominate two out of eight seats on the Crocs board of directors since Stephen Cannon and Jeffrey Margolis have resigned from the company’s board.
“The willingness of Steve and Jeff to resign voluntarily from our board in order to accommodate new directors associated with Blackstone’s investment demonstrates their professionalism and commitment to Crocs,” said Smach. “They have served the company’s shareholders well, and on behalf of the board, I would like to thank them for their service. We are sad to bid them farewell and wish them the best in their future endeavors.”
Moelis & Company LLC acted as financial advisor and Perkins Cole LLP acted as legal counsel for Crocs. Piper Jaffray & Co. and Macquarie acted as financial advisors and Simpson Thacher & Barlett LLP acted as legal counsel for Blackstone in connection with the investment.
“With the closing of the transaction and the appointment of our two new directors, we can now turn our attention to recruiting a new CEO and moving forward with refining the strategic direction of the Crocs business,” continued Smach.
By Pia Talwar