Deckers Outdoor Corporation announced that it has entered into a joint venture with Stella International Holdings Limited for the opening of retail stores and wholesale distribution for the UGG Australia brand in China.
Initial plans call for the opening of one to two stores in 2008. The joint venture will be owned 51% by Deckers and 49% by Stella International.
The initial investment in the joint venture is $1 million to be contributed by each party in proportion to their respective ownership in the joint venture. The estimated total investment amount for the joint venture is approximately $5 million.
Angel Martinez, President and Chief Executive Officer of Deckers, commented, "We are very excited about this initiative.
China has quickly become a dynamic market for U.S. consumer branded footwear and apparel and we are confident that UGG Australia's lifestyle message and product line will resonate very well in this new market.
We have a long term relationship with Stella having worked with them for over 12 years and look forward to continuing to work closely with them in order to maximize the potential of this extremely compelling opportunity for our Company."
Stella International develops and manufactures footwear products for leading casual and fashion footwear companies worldwide.
The Company manufactures footwear at its facilities in Guangdong Province, China and through processing and contractual arrangements in both China and Vietnam.
Mr. Jack Chiang, Chairman of Stella International, said, "We believe the UGG Australia brand is the ideal vehicle to launch our first joint venture since our public listing late last year.
With our extensive experience in footwear manufacturing and operation of over 100 high end Stella Luna and What For retail stores we are confident in our ability to quickly penetrate the market.
In addition, this strategic alliance with Deckers will enable us to enhance our strong foothold in the consumer sector throughout Greater China."
Deckers Outdoor Corporation