WeSC Surges After U.S. Oved License Deal: Stockholm Mover
WeSC AB (WESC), a Swedish fashion retailer, rose the most since 2009 after the company agreed to grant Oved Apparel Corp. an exclusive license for its clothes in the U.S.
The 10-year agreement gives WeSC 10 percent of Oved’s sales of its brand and minimum payments of 115 million kronor ($16 million), the Stockholm-based company said in a statement.
The share rose as much as 3.8 kronor, or 18 percent, the most since Aug. 6, 2009, and was up 16 percent to 24 kronor as of 4 p.m. in the Swedish capital. WeSC’s shares have fallen 12 percent this year, valuing the company at 174 million kronor.
’’We signed an attractive deal which basically sends 10 percent of our sales there back to us as EBIT,’’ WeSC Chief Executive Officer Greger Hagelin said by telephone from New York.
Oved will take charge of WeSC’s U.S. offices and organization with the exception of the stores in New York and Los Angeles, WeSC said.
“We’ve made significant investments in our brand in the U.S. over the last few years without succeeding to capitalize on the value we have built and our American business has been a drag on the rest of our operations,” Hagelin said.
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