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Wednesday, October 28, 2020
Banking Blue collar payday: Fort Worth workwear company acquired for $820M

Blue collar payday: Fort Worth workwear company acquired for $820M

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Robert Francis
Robert is a Fort Worth native and longtime editor of the Fort Worth Business Press. He is a former president of the local Society of Professional Journalists and was a freelancer for a variety of newspapers, weeklies and magazines, including American Way, BrandWeek and InformatonWeek. A graduate of TCU, Robert has held a variety of writing and editing positions at publications such as the Grand Prairie Daily News and InfoWorld. He is also a musician and playwright.

Williamson-Dickie Manufacturing Co.

Fort Worth

Purchase price: $820 million in cash

Founded in 1922 in Fort Worth

Family owned, private company

More than 400 retail stores globally

Major retail brands: Dickies, Walls, Workrite, Terra, and Kodiak

Cultural impact: Supplies Big Tex clothing, naming rights for Dickies Arena

VF Corp.

Greensboro, North Carolina

Organized in 1899, VF Corp. is a global leader in branded lifestyle apparel, footwear and accessories, global iconic brands, 62,000 employees and $12.4 billion in revenue.

www.vfc.com.

Fort Worth’s blue collar, hard scrabble roots got an $820 million shout out last week.

Williamson-Dickie Mfg. Co., a 95-year-old Fort Worth-based, family-owned company that designs, manufactures and sells workwear and apparel, announced Aug. 13 it will be acquired by VF Corp. for $820 million cash on the barrelhead.

Williamson-Dickie will retain its CEO Phillip Williamson and remain headquartered in Fort Worth, according to both companies. VF Corp. is the parent company of outdoor shoemaker Timberland and apparel brands such as North Face and Vans.

Williamson said this was the right fit for a privately held company that has seen many suitors come courting in its near-100-year history.

“Over the years, many companies have come knocking on our door expressing interest in acquiring Williamson-Dickie and our portfolio of brands,” he said, speaking at a webcast following the announcement. “None of those companies were the right fit for us for many reasons. VF has proven themselves to be a different story.”

Williamson noted many similarities between the two companies, both having a heritage in manufacturing. “[O]ur two companies fit together naturally, because they embrace and represent the same values, standards and commitment to quality,” he said. “We believe that by combining our brands into VF’s portfolio and leveraging each other’s strengths will unlock many exciting opportunities in months and years ahead.”

Mirroring Williamson’s comments, VF Corp.’s Steven E. Rendle, president and CEO, praised Williamson-Dickie as a business and for its values.

“Williamson-Dickie is one of the largest companies in the work sector. It has a diverse global portfolio of iconic brands, steeped in a deep heritage and authenticity,” he said in the webcast. “Williamson-Dickie has been in the business serving in loyal consumer for nearly 100 years, and it’s built on a bedrock of family and business values that connect deeply to the way VF operates as an enterprise.”

Williamson-Dickie has maintained a fairly low profile in Fort Worth over the years, occasionally sponsoring events, nonprofits and other marketing projects. It highest – and tallest – profile campaign has been to sponsor Big Tex’s clothing at the State Fair of Texas. But the company recently acquired the naming rights for the $450 million arena slated to open in November 2019 in Fort Worth. Terms of the deal were not disclosed. There will be no impact on the naming rights, Williamson-Dickie officials said.

Williamson-Dickie sells its products in more than 100 countries across six continents, employs more than 7,000 and operates a network of stores under various brands including Dickies, Workrite, Kodiak, Terra, Walls, Big Smith, Liberty and Duxbak. According to the news release, on a trailing 12-month basis, Williamson-Dickie generated approximately $875 million of revenue. The company has about 1,000 local employees at its Vickery Boulevard headquarters and distribution center.

Not bad for a company founded back in the first half of the 20th century catering to the then-rural-based Texas culture and business climate.

“My family founded Williamson-Dickie in 1922,” Williamson said. “Back then, we were selling denim bib overalls to Texas ranch hands. In five to 10 years, we rapidly expanded to include men’s, women’s and kid’s apparel, and our sales territory covered the entire Southwest.”

In the next 20 years, the company expanded to cover most of the country. Then, mid-century, the company piggybacked on Texas’ economic powerhouse of black gold to expand beyond national borders. “[I]n the 1950s, we expanded our brands internationally, specifically selling workwear to oilfield workers in the Middle East and in the North Sea,” he said. “In the 1980s and 1990s, our Dickies brand was adopted by pop culture and today we’re proudly standing strong with a solid presence in more than 100 countries. It has been an awesome journey for us, one that we’re extremely proud of.”

VF Corp., considered a global leader in branded lifestyle apparel, was founded in 1899 and is one of the world’s largest accessories, apparel and footwear companies, operating various brands including Vans, The North Face, Timberland, Wrangler and Lee. This is VF Corp.’s first major purchase since it acquired Timberland Co. for about $2 billion in 2011.

Like Williamson-Dickie, North Face, Vans, and Timberland all had operating margins below 10 percent at the time of VF Corp.’s acquisition. “Williamson-Dickie has both gross and operating margins that are below those of VF’s workwear business today. The company’s operating margin is currently around 7 percent,” said Scott A. Roe, chief financial officer at VF Corp.

Today, Roe noted, North Face, Vans, and Timberland brands have a combined operating margin in the high teens. The acquisition plan includes a 14 percent operating margin target by 2021, for Williamson-Dickie, according to the analyst presentation.

“So, there is a blue print and our proven operating model will add tremendous value. We have a long track record of successfully integrating acquisitions,” Roe said.

The acquisition should double VF Corp.’s workwear business, according to the presentation given to analysts. “Building on our solid foundation in workwear, the acquisition of Williamson-Dickie creates a $1.7 billion workwear powerhouse that will now serve an even broader set of consumers and industries around the world,” said VF Corp.’s Rendle.

Catering to blue collar workers is not a bad business to be in, with workwear estimated to be a $30 billion business worldwide. Competitors for VF Corp. and Dickies include Carharrt Inc., Red Wing Shoe Co., Duluth Trading Co. and Wolverine World Wide Inc.

VF Corp. already competes in workwear in the mining, transportation, construction and manufacturing space. Williamson-Dickie competes in those spaces as well, but also has work wear products in the health care and services sectors, two areas expected to see strong growth in the next few years. While it doesn’t happen all the time, workwear sometimes becomes trendy and shows up in boutiques in London, New York and Paris.

While Wall Street generally applauded the move by VF Corp., some hometowners remain concerned that Fort Worth continues to see local heritage firms become acquired by larger, outside interests.

“The Williamson-Dickie Co. is one of our most important local companies,” said Doug Harman, a former Fort Worth City Manager. “I am hopeful that the new owner will appreciate that fact and allow it to continue to be a major local institution with its many ties to our Fort Worth heritage.”

For his part, Williamson believes the best is yet to come.

“[The] first 95 years of business have been very good to Williamson-Dickie, and I know that my family and I are proud to partner with VF to make the next 95 years even better,” he said.

.

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