NEW YORK ? (Reuters) - VF Corp, owner of clothing brands such as The North Face and Wrangler jeans, said it would buy shoemaker Timberland Co for $2 billion to boost its outdoor and action sports business.
The deal values Timberland at $43 a share, a 43 percent premium to Friday's closing price of $29.99 on the New York Stock Exchange.
The companies expect the deal, which was unanimously approved by both boards, to add to VF's earnings per share by 25 cents in 2011 and by 75 cents in 2012, including acquisition-related expenses.
Timberland, home to its namesake label and brands such as Mountain Athletics and SmartWool, expects 2011 revenue of $1.6 billion, more than half of which is generated internationally.
The parties expect the deal to close in the third quarter and add about $700 million to VF's 2011 revenue.
VF said it aimed to boost Timberland sales by 10 percent annually by using its distribution channels in Europe, Asia and Latin America as well as by expanding Timberland's women's footwear and apparel business, among other measures.
VF plans to finance the deal through a combination of cash on hand, commercial paper and term debt.
Shares of Timberland were up 42.4 percent at $42.72 in premarket trading.