|9 Months Ended|
Dec. 26, 2020
|Business Combinations [Abstract]|
On November 8, 2020, VF entered into a definitive merger agreement to acquire 100% of the outstanding shares of Supreme Holdings, Inc. ("Supreme"). The acquisition was completed on December 28, 2020, in VF's fourth quarter of Fiscal 2021, for an aggregate base purchase price of $2.1 billion, which was funded with cash on hand and short-term borrowings. At the end of the third quarter, VF designated $2.2 billion of cash for the acquisition, which is included in the cash and equivalents line item in the Consolidated Balance Sheet as of December 2020, as there were no legal or other restrictions related to these amounts. The base purchase price is subject to working capital and other adjustments. VF may make an additional future payment of up to $300.0 million, subject to the satisfaction of certain post-closing performance milestones through January 2022.
Supreme was a privately-held company based in New York, New York and is a global streetwear leader that sells apparel, accessories and footwear under its namesake brand, Supreme®, through direct-to-consumer channels, including digital. The acquisition of Supreme accelerates VF's consumer-minded, retail-centric, hyper-digital business model transformation and builds on a long-standing relationship between Supreme and VF, with the Supreme® brand being a regular collaborator with VF's
Vans®, The North Face® and Timberland® brands. The acquisition also provides VF with deeper access to attractive consumer segments and the ability to leverage VF's enterprise platforms and capabilities to enable sustainable long-term growth.
The Company recognized $6.6 million of transaction and deal-related expenses in the three and nine months ended December 2020 in the selling, general and administrative expenses line item in the Consolidated Statements of Operations.
In connection with the acquisition, VF deposited in escrow 605,050 shares of VF Common Stock, which are subject to certain restrictions, for a key member of Supreme management. The common shares are subject to certain future service requirements and vest over periods of up to four years. VF will recognize the stock-based compensation cost for the fair value of these awards over the vesting periods.
The Company is still in the process of aligning accounting policies, determining purchase price and valuing the assets acquired and liabilities assumed, and as such, certain disclosures regarding this transaction have not been included herein.
The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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