American Eagle Outfitters to acquire fulfillment partner
Pittsburgh-based apparel retailer American Eagle Outfitters (AEO) announced on Tuesday that it has agreed to acquire its fulfillment partner, Quiet Logistics, Inc., as well as other strategic investments, for $350 million in cash, as part of the company’s ongoing efforts to transform its supply chain.
According to the American fashion retailer, Quiet Logistics leverages state-of-the-art technology and robotics to offer in-market fulfillment services to AEO and a range of other consumer brands.
The company, which operates through a network of fulfillment centers located in Boston, Chicago, Los Angeles, Dallas, St. Louis and Jacksonville, works to ensure that its partners can offer same-day and next-day delivery options to both customers and stores.
The announcement of AEO’s deal with Quiet follows the retailer’s recent acquisition of logistics start-up AirTerra and continues the company’s attempts to create an innovative supply chain. Quiet is expected to not only support AEO’s growth, but also drive economies of scale as its own customer base expands to include more brands and retailers.
“The Quiet Logistics team shares our vision for an asset-light, technology-led supply chain network and brings strong expertise,” explained AEO COO Michael Rempell in a release. “This transaction will formalize our successful partnership, provide control and flexibility within our operations and accelerate the growth of Quiet Logistics.”
The acquisition, which is expected to close before the end of the year, will see Quiet become a wholly-owned AEO subsidiary, which will continue to run as an independent business. AEO expects the transaction to be accretive in the first full year after the deal closes.
“An important pillar of our strategy is transforming our supply chain to create greater agility, speed and diversification. Our vision is to create an on-demand, hyper-scaled operations platform that enables brand success,” said AEO executive chairman and CEO Jay Schottenstein. “Quiet Logistics has provided significant benefits to AEO over the past year and we are leveraging our healthy cash position to ensure ongoing advantages.”
In the second quarter ended July 31, 2021, AEO reported revenue of $1.19 billion, up 35% compared to the same period in the previous year, while quarterly net income was $121.5 million. For the first half of the fiscal year, the company posted a loss of $13.8 million on revenues of $883.5 million.
Operating under the American Eagle and Aerie banners, AEO runs stores in the U.S., Canada, Mexico, and Hong Kong, and ships to 81 countries around the world via its e-commerce platforms.
Copyright © 2022 FashionNetwork.com All rights reserved.