Delta Apparel Completes Sale of The Game Branded Business
Delta Apparel, Greenville, S.C., announced that it has completed the sale of its The Game branded collegiate headwear and apparel business to David Peyser Sportswear Inc., owner of MV Sport Inc., Bay Shore, N.Y., for approximately $14.5 million paid in cash at closing, with an additional $500,000 payment contingent upon certain conditions unrelated to the performance of the business. The business consists of The Game branded products sold nationally in college bookstores and through team dealers.
The transaction does not include accounts receivable and certain undecorated apparel inventory, and Delta expects to realize approximately $6 million from its collection or sale of these assets. The approximately $21 million total value of the business sold is more than $8 million above book value and represents approximately 85 percent of revenue. Net of selling, transactional and transitional expenses, Delta Apparel expects to realize a pre-tax gain of approximately $6 million. Delta originally bought the business in 2009 for $5.7 million, or about 20 percent of revenue, which was less than the net value of the current assets acquired.
Robert W. Humphreys, Delta Apparel's chairman and CEO, said that in addition to further strengthening Delta's balance sheet, the sale will enable the company to focus on areas of its business that are more strategic to its long-term goals. "Our Salt Life and corporate businesses currently operating within To The Game LLC will not be affected by the sale of the collegiate part of the business," he said. "While the sale has obvious benefits for Delta Apparel, including allowing us to invest more capital in expansion strategies for Salt Life and our other brands, we believe that The Game's branded products, which include the 'Bar' and 'Circle' trademarks, will make a strong addition to MV Sport's wide range of custom decorated apparel sold in college bookstores and other markets."
"We are excited to be adding The Game to our MV Sport business," said Josh Peyser, president of MV Sport. "The Game is a leading headwear brand with strong consumer recognition in the collegiate and team dealer markets, and combining it with our MV Sport product lineup gives us a formidable presence in those markets. We are looking forward to integrating The Game's highly professional sales, customer support and design teams into the MV Sport family."
For more information, visit www.deltaapparelinc.com.