Skagen Designs sold to Fossil in $237 million transaction
Henrik and Charlotte Jorst, who launched their Skagen Designs from a tiny New York apartment where they sometimes lived on a diet of bread and catsup, are selling the Reno-based company in a transaction that carries a value of about $237 million and maybe a few million dollars more.
Fossil Inc., a Dallas-area marketer of consumer fashion accessories, said last week it plans to acquire Skagen Designs in a transaction that includes approximately $225 million in cash and 150,000 shares of Fossil’s publicly traded stock, which were valued at about $80 a share when the transaction was announced. (The stock rose about 8 percent after the announcement.)
The Jorsts can be paid another 100,000 shares of Fossil stock about $8 million worth if Skagen hits sales targets after the acquisition closes.
Privately held Skagen got its start as a maker of watches with a sleek modern design and expanded into sales of jewelry, sunglasses and clocks sold in 75 global markets.
From its headquarters at 640 Maestro Drive in Reno, the company oversees company-owned retail stores in Denmark, Germany, the United Kingdom and Hong Kong.
Kosta Kartsotis, chief executive officer of Fossil, said in a prepared statement that Fossil sees “enormous potential” to further develop Skagen Design as a lifestyle brand.
Executives of either company didn’t comment further last week about changes if any that are foreseen at Skagen Designs after the acquisition, which is scheduled to close next month.
Skagen Design has been headquartered in northern Nevada since 1993, when the Jorsts moved to Incline Village from their previous home in New York City.
They came to the United States from their native Denmark in 1989 Henrik Jorst was a the brand manager for beer-maker Carlsberg, and his wife worked as a part-time model and began designing watches with corporate logos in the basement of a tiny New York apartment.
By 1992, they were designing and selling watches through high-end specialty stores, and the company was doing well enough that Nevada’s tax-free environment drew them West.
The company got a major break in 1995, when the Bloomingdale’s department store chain started carrying Skagen watches. Still working out of their home in Incline Village, the Jorsts found themselves overwhelmed with boxes of watches.
From that experience, they decided to move design, distribution and corporate offices to Reno.
Even as the company grew in Nevada, however, the colors of the skies and seas in the Jorsts’ native land continued to provide the primary themes for Skagen Design products.
“The best transactions are defined by sellers being willing to set their ego aside for the benefit of their customers and employees,” writes Mike Bosma.