Look At The Bustle: Is The $260 Million Acquisition Of The Declining World'S XTEP Rising?

In May 2nd, XTEP International Holdings Limited (hereinafter referred to as XTEP) announced that through its wholly owned Affiliated Companies, E-Land World Company, Ltd and E-Land USA Holdings Inc. (collectively known as "clothing and love group") entered into a share purchase agreement.

XTEP will pay $260 million (about 1 billion 750 million yuan) in cash to acquire all the issued shares of E-Land Footwear USA Holdings Inc., holders of brands such as K-Swiss, Palladium and Supra.

XTEP said the acquisition would be funded by internal funds and is expected to be completed by the end of July 2019.

In 2012, the annual income of the group was $223 million, while in 2018 it was $109 million, which was less than half the income of the Korean attachment group.

Brand building has a direct impact on the popularity of a brand enterprise. After its establishment in 2001, XTEP demonstrated its avant-garde, fashion, personality and freedom.

Fashion, avant-garde, freedom and rebellion interpret the "XTEP" brand culture.

Now, as one of the four major sporting goods brands in China, XTEP has taken a certain seat in the Chinese market and Chinese consumers.

In 2011, XTEP sponsored the Villarreal team, which is the first Chinese brand to sponsor La Liga.

Nowadays, with the clear strategy of the domestic sports brand, the brand new development platform stage of the domestic sports brand giants has basically taken shape.

In recent years, XTEP's strategy of multi brand and internationalization of XTEP has been determined.

From the acquisition target of XTEP, XTEP has consistently extended the brand strategy of professional sports.

By acquiring internationally mature sports brands, Anta has filled Anta's gap in these markets on the one hand, absorbing the experience and expertise and technology of mature brands on the other hand, and initially formed three camps of mass professional sports, high-end fashion sports and professional outdoor sports.

Moreover, Anta continues to sponsor sports events to make Anta brand more familiar to the public.

While Lining's strategy is different from Anta and XTEP, Lining focuses on the main brand and further strengthens its product lines.

After the New York fashion week and Paris men's wear week, Lining's goal is the younger generation of consumers to come out of a different sports fashion path, and Lining will take the first and second tier cities as the main battleground in the future.

According to the relevant data, in 2018, only four of the major domestic sports brands, only XTEP's R & D expenditure was less than 200 million yuan.

In the same period, the R & D expenses of Anta, Lining and 31st degree were 599 million yuan, 229 million yuan and 215 million yuan respectively.

This also means that XTEP's three year pformation plan has not yet reversed its low R & D costs.

In addition, it is important to note that with the improvement of people's income and the upgrading of consumption concept and fitness concept, consumers' demand for sports shoes performance will be higher and higher. XTEP's "price advantage + strong marketing" approach may not be able to go on forever.

Marketing can narrow the distance between consumers and brands, but only research and innovation can enhance the core competitiveness of products.

"Enter XTEP children's XTEP brand center