Millennials are officially the largest generation with its 75.4 million population, surpassing the 74.9 million baby boomers. As such, it should come as no surprise that retail brands are taking this into consideration with future strategic business moves.
With its eyes set on luring in millennials to its brand, Coach is looking to acquire Kate Spade for $2.4 billion. At this purchase price, Coach is coming in at a 9 percent increase of Kate Spade’s current stock price of $18.36 at its $18.50 cash offering.
With Kate Spade’s shares up 17 percent since around the Christmas holidays, it’s prime for acquisition talks. As more pricey handbags are struggling to bring foot traffic into stores, Coach is hoping Kate Spade’s 60 percent share of its millennial customers will help give the brand the needed financial boost to survive.
Following the closing of this deal in Q3 2017, Coach is expecting to save $50 million over the course of the next three years.