Pickerington, OH—R.G. Barry Corp. is expanding its accessories offerings beyond its Dearforms and other licensed slippers business. The company announced Thursday that it plans to acquire baggallini, Inc., the Portland, Oregon-based handbag and accessories company, for $33.8 million.
Calling the baggallini acquisition “transformative,” Greg Tunney, R.G. Barry’s ceo, said: “The face of R.G. Barry immediately changes from that of a one-dimensional, modest-growth slipper company to that of a multi-faceted, growing provider of functional, fashionable accessories.”
No Longer a Slipper-Centered Company
Fonded in 1995, baggallini, Inc. is privately owned company best known for its fashionable, functional, organized handbags, tote bags and travel accessories that are sold primarily to specialty and independent retailers, boutiques, travels stores, catalogs and on-line retailers. “From 2006 to 2010, baggallini recorded a compounded annual revenue growth rate of approximately 19%,” R.G. Barry reported in a statement about the purchase.
“Until now, our business has been almost entirely rooted in accessory footwear, which accounts for only about 2% of the $30-billion-plus women’s accessories market,” Tunney said.
But with the baggallini purchase, along with its previous purchase of Foot Petals, R.G. Barry will have “now have established, growing businesses in the much larger handbag and foot care segments, both of which offer us significant opportunities for high growth and profitable expansion,” he added. “We have added a new, much less promotional roster of specialty and independent retailers to our already strong customer base. As a result, our business is less concentrated and the blend of products that we will be marketing will include more full-priced, higher-margin goods.”
Jose Ibarra, senior vice president finance at R.G. Barry, added that “baggallini met all key criteria in our strategic acquisition filter. It is asset light, cash generating and will be immediately accretive to earnings; it expands our customer and consumer demographic bases; and it will benefit from backroom synergies with our existing enterprises.”
Tunney said that baggallini’s key management will be joining R.G. Barry and the handbag company will remain based in Oregon as a wholly-owned subsidiary. The deal is expected to close March 31.