The kids are all right: Schuh staff share £37m

The footwear chain Schuh is to share nearly £40m among almost 3,000 of its youthful staff after it was acquired by Genesco, the US retail group, in a deal worth £125m.

Colin Temple, the managing director of Schuh, and Mark Crutchley, its finance director, will net a whopping £25m each, but the earn-out depends on them remaining at the company. The two directors own 75 per cent of the retailer.

Genesco said that Schuh – which is based in Livingston, Scotland, and has 59 stores and 16 concessions – has "attractive store economics and solid growth prospects".

Schuh's 2,827 staff, who have an average age of 21, will share a payout of £37.3m, based on their salary and length of service at the retailer.

For instance, an employee of Schuh for four years would receive a bonus equal to 110 per cent of their salary, while someone with 10 years' service will bag a multiple of 250 per cent.

The branded-footwear chain is also donating up to £7m from the transaction towards a newly established charitable foundation, the Schuh Trust.

In addition, the deal provides for an earnings-related bonus of up to £25m payable if Schuh hits targets for underlying earnings.

Mr Temple – who joined Schuh 26 years ago as a merchandiser of men's footwear – said it had been approached by Genesco about the acquisition, rather than soliciting a sale.

Schuh delivered net sales of about £164m in the year to 27 March 2011, boasting an operating margin of more than 9 per cent.

He said: "It secures growth for us under a parent, such as Genesco. The cost of borrowing is cheaper for us and they understand the pain we sometimes feel because they are in the same marketplace."

The purchase price paid by Genesco was £100m before adjustments for debt and working capital.

Genesco sells footwear, headwear sports apparel and accessories in more than 2,285 retail stores in the US and Canada, primarily under the names Journeys, Lids and Johnston & Murphy.

Schuh is the latest UK retailer to be acquired by a bigger US group. Jones Group bought Kurt Geiger, the premium shoe retailer, from Graphite Capital, in a deal worth £215m this month.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Please enter a valid email
Please enter a valid email
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Please enter your first name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
Please enter your last name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
You must be over 18 years old to register
You must be over 18 years old to register
Opt-out-policy
You can opt-out at any time by signing in to your account to manage your preferences. Each email has a link to unsubscribe.

By clicking ‘Create my account’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in