WSJ: Sequential Brands Near Deal To Buy Galaxy Brand Holdings For $260 Mln

(RTTNews) - Brand licensing company Sequential Brands Group Inc. (SQBG) is nearing a deal to buy rival Galaxy Brand Holdings Inc. for $260 million in cash and stock, the Wall Street Journal reported Tuesday, citing people familiar with the matter.

According to the WSJ report, New York-based Sequential Brands will pay $100 million in cash and the remaining $160 million in stock in a deal that could be announced as early as Wednesday.

Galaxy Brand, with about $1 billion in annual sales, is majority-owned by private equity firm Carlyle Group LP (CG), which made an investment in the company in 2013. Galaxy Brand was founded in 2011.

An acquisition of Galaxy Brand, also based in New York, would enable Sequential to double its size as well as annual sales. Sequential Brands currently has a market capitalization of $284.75 million.

Sequential Brands owns, promotes, markets, and licenses a portfolio of consumer brands to retailers, wholesalers, and distributors in the United States and internationally.

The acquisition will add Galaxy Brand's Linens 'N Things, And1, Avia and Nevados brands to Sequential's portfolio of brands comprising William Rast, Ellen Tracy and Heelys. In November 2013, Sequential agreed to acquire the Franklin Mint Brand, which sells collectibles such as coins, figurines, stamps and board games.

According to the WSJ report, Galaxy's And1 brand that focuses on basketball apparel, and its Avia athletic shoe brand are of particular interest to Sequential, as these brands will boost Sequential's presence in the performance athletic part of the retail sector.

SQBG closed Tuesday's regular trading at $11.66, up $0.23 or 2.01 percent on a volume of 129,508 shares. In after-hours, the stock further gained $0.59 or 5.06 percent to $12.25.