London-listed footwear manufacturer Coats has agreed to buy a US company that makes premium shoe insoles for 770 million US dollars (£573 million).
The company said acquiring OrthoLite means it is bringing together two “global leaders” in the industry.
OrthoLite makes open-cell foam insoles, designed to be a more comfortable and sustainable lining for shoes, for a swathe of shoemakers including Adidas, Nike, Converse and Asics.
It has more than a third share of the market and supplies about 500 million pairs of insoles a year to around 550 brands.
Coats, which is listed on London’s FTSE 250 index, is a global specialist in thread manufacturing and making components for clothes and footwear.
It said it had agreed to buy OrthoLite for an enterprise value of 770 million US dollars.
The acquisition will be funded through a combination of new debt facilities with its existing lenders and by raising funds from issuing new shares to investors.
Coats said it would benefit from expanding into the fast-growing premium insole market where there is a big overlap with its existing footwear customers.
“The combination of Coats and OrthoLite is fantastic news for both companies and for the footwear industry,” chief executive David Paja said.
“It brings together two global leaders in adjacent segments of the footwear components sector with a shared vision for innovation and sustainability and with unparalleled brands and customer relationships.”
