3G Capital’s $9.4 billion take-private buyout of Skechers
- Agastya Jain
- May 30
- 7 min read
By: Neil Patel
5/30/2025
Deal Overview:
Acquirer: 3G Capital, Inc.
Target: Skechers (NYSE: SKX)
Sector: Consumer
Subsector: Consumer Discretionary (Footwear)
Transaction Size: $9.4 billion
Transaction Structure: 100% equity take-private buyout
Transaction Financing: Cash
Closed Date: Q3 2025E
Firm Overview:
3G Capital (Acquirer): 3G capital is a long-term private investment firm focused on the relationship between owner and operator based out of New York. They are a major player in the retail space, with past investments such as the Kraft Heinz company and Restaurant Brands International (owners of Burger King and Tim Horton’s). As of December 2024, the firm has around $14 billion AUM.
Skechers (Target): Skechers is a leading discretionary consumer brand. Founded in 1992 and based in Manhattan Beach, California, Skechers offers lifestyle footwear and apparel designed for all ages and sizes. Skechers is the world’s third-largest footwear company, only behind Nike and Adidas. They have 5,300 retail stores, some owned by Skechers themselves while others are owned by third party retailers, in addition to its e-commerce platform. Having recorded nearly $9 billion in annual sales in 2024 and $2.4 billion in Q1 2025, Q1 2025 represents 7.1% YoY growth, driven by a 10.6% YoY growth in Direct-to-Consumer (DTC) sales. Skechers also boasts a 52% gross margin on its sales in Q1, similar to overall performance over the past several years and higher than Nike and Adidas. The increase in revenue growth and gross margins from DTC sales counteracts the revenue growth and gross margin headwinds from its wholesale numbers, indicating a great shift towards a profitable DTC business model.
At the time of acquisition, SKX was trading at a near 1 year low in Q1 2025, primarily due to the withdrawal of 2025 financial guidance, attributed to potential supply chain disruptions and international, macroeconomic uncertainty, as stated by Skechers’ management team. Slight underperformance of revenue figures compared to expectations also contributed to low analyst ratings and overall price decline.
Given Skechers’ reliance on international sales, an efficient international supply chain is necessary to meet demand. All Skechers products are produced by third-party manufacturers, majority of which are located in Vietnam and China. The top 5 manufacturers produce nearly 40% of all Skechers products. Skechers is a global player, operating distribution centers in California, Belgium, U.K, China, and India in order to deliver products straight to retail partners and its own stores from contracted manufacturing facilities. 32% ($627,000,000) of total PPE is located internationally, half of which is located specifically within China. PPE mostly consists of inventory warehouses, distribution centers, retail stores, offices, and day-to-day capital equipment. When it comes to Skechers’ customer base, 30% ($718,211,000) of total sales come from Europe while another 25% ($588,990,000) comes from APAC (Asia/Pacific) countries, exhibiting Skechers’ reliance on international demand and the importance of cross-country production, distribution, and selling.
Sector & Deal-Relevant Trends:
2024 Consumer Discretionary Spending and Global Footwear in Review: US consumers generally kept spending in 2024, although lower-income consumers felt a greater pinch from still-high interest rates and inflation. In aggregate, the consumer discretionary sector delivered strong gains in 2024. High-income and low-income earners had a massive spread between spending habits, as companies in the high-expenditure range (auto-motive, home improvement) suffered whereas companies like Amazon had strong equity returns. Rate-cutting in the back half of 2024 was also encouraging, especially for home-builders, hoping for lower mortgage rates and better demand. Global footwear in particular hit a market size of $458 billion in 2024, with a projected 4.3% CAGR globally over the next five years. Footwear also requires a tactile experience, encouraging companies to keep investing in wholesale and retail operations in addition to their online platforms. Sustainability initiatives including recycled materials is becoming a focus for footwear-focused companies as ESG continues to play a large role in corporate America. Finally, qualitatively, retailers are noticing a consumer shift focusing on ergonomics and customization, allowing for athletic footwear to surge in popularity and volume.
2025 Consolidation: Skechers’ take private deal with 3G capital, while significant in the private markets, represents a broader trend of Q1 merger and acquisition activity. On the private end, luxury footwear manufacturer Golden Goose has sold 12% of its stake for $264 million to Blue Pool Capital, a family office, in February. Public markets show immense consolidation in the global footwear space, represented by Steve Madden acquiring Kurt Geiger (private) for $361 million, Tapestry holding group selling Stuart Weitzman (portfolio company) to Caleres for 105 million (20% of the original purchase price), and Prada purchasing Versace (portfolio company) from Capri Holdings for $1.4 billion (65x EV/EBIT), all deals taken place in the past 4 months. Recently, Dick’s Sporting Goods’ (DSG) $2.4 billion acquisition of Foot Locker represents a 66% premium, generally attributable to elimination of competition and effective revenue/expense synergies. It is important to note that while the Foot Locker sale gives overall insights to consolidation within the footwear and apparel space, both Foot Locker and DSG are retailers instead of producers. These are mostly strategic investments given the emphasis on direct-to-consumer business model and overall resilience of the footwear industry, relative to broader economic decline.
It is significant to note that some of these transactions are carve-outs, where a holding company sells one of its portfolio brands to another company. This is representative of an emerging trend within both public and private equity spaces. Full, large-scale buy-outs of holding companies are rare given a strict antitrust regulation, as seen by the Federal Trade Commission blocking the Capri-Tapestry merger. Private Equity has amassed trillions in dry powder and institutional lending for leveraged buy-outs (LBO) are sitting at 3 year highs, priming overall apparel and specifically footwear for stable, premium valuations relative to public equities and continuing hot acquisition activity.
2025 Tariffs: As the S&P 500 Discretionary Index demonstrates, the sector has experienced a rapid decline in the first quarter of 2025, and that decline was only amplified by recent tariff news and trade wars. In a recent letter directed toward President Trump, over 80 companies, including Skechers, lobby for tariff exemptions given the threats to jobs, inventories, and company closures. Tariffs are significantly hurting footwear and apparel brands with international supply chains, manufacturing plants, and distribution centers, which they rely on for all revenue streams. Because clientele includes lower to middle income earners, tariff prices cannot be passed down in the product and must be absorbed by the companies themselves. A logistical shift of manufacturing takes years to plan and execute, undermining the overall goal of shifting footwear and apparel manufacturing back to the United States.
Projections, Opportunities, and Risks:
Not Exactly a Fire-sale: While take-privates have usurped news headlines with massive buy-out amounts (e.g. Sycamore Partners’ $23 billion take-private of Walgreens), 3G’s acquisition of Skechers was rather shocking. With nearly $9 billion in sales in 2024 and a strong top-line start in Q1 2025, Skechers was nowhere near to a distressed company. After a series of missed EPS from earnings and poor analyst ratings, its stock price driven by panicking investors declined over the past year. However, CEO Robert Greenberg, President Michael Greenberg, and the rest of the Greenberg family will continue to manage Skechers to ensure affordability, comfortability, and innovation within the footwear space. Instead of being accountable to millions of small investors pressuring Skechers amidst a trade war, there is now only one large investor needing to be reported to, limiting volatility. This will allow for level-headed planning to address supply chain threats and the real macroeconomic pressures. There are still major plans for international roll-out, for which a Brazil-based investment firm such as 3G capital can give resources to aid in Direct-to-Consumer sales. It is also clear that despite trade wars and economic turmoil helping accelerate this deal making process, it was not a fire-sale. Merger and acquisition processes take time to negotiate financial, strategic, and legal details, and it can be reasonably inferred that talks of a take-private have been occurring since before President Trump’s tariff roll out.
A New Frontier for the International Sponsor: 3G Capital is a private markets investing firm known for its take privates of major food chains, including Burger King, Firehouse Subs, Popeye’s, Tim Horton’s and Kraft Heinz. However, Skechers serves as a unique purchase outside of the standard target for 3G. While Skechers had been a family-run corporation, similar to other 3G portfolio companies such Douglas, 3G acquired Skechers at a 30% premium ($63 per share). For an investment company with limited experience in such discretionary consumer spending companies and even less experience in retail footwear, this represents a significant risk for the Skechers brand at a record-breaking price under an uncertain international economy. 3G capital has past investments where R&D budgets have been slashed and marketing spend has been limited. It has yet to be seen if 3G will use this same, operational efficiency approach to improve margins within Skechers or if alternative methods will be used to drive up valuation and expand multiples. Complex supply chains, rapidly evolving fashion tastes depending on consumer research and sentiment, and high international demand provide a perfect storm for 3G to navigate through in a new industry which they have historically had suboptimal exposure to. Resilience of the consumer spending can be a driving force in mitigating this risk, although a reliance on this alone demonstrates a risk-inclined purchase from 3G.
Analysts are also suspecting that this represents an exit strategy for CEO Robert Greenberg to pass his company down to his son and current President Michael Greenberg. A change in management team in addition to a change in complete ownership foreshadows trying times for Skechers brand. Skechers CFO reported unpredictability in inventory production because of President Trump’s trade war and the logistics of moving production plants to lower-tariff nations while still effectively serving the insatiable demand of the global economy.
“We are thrilled to be partnering with Skechers and look forward to working with an entrepreneur of Robert’s caliber and the talented Skechers team. Skechers is an iconic, founder-led brand with a track record of creativity and innovation. We have immense admiration for the business that this team has built, and look forward to supporting the Company’s next chapter. Our team at 3G Capital is built to partner with companies like Skechers"
- Alex Behring, Co-Founder and Co-Managing Partner, and Daniel Schwartz, Co-Managing Partner, 3G Capital
“With a proven track-record, Skechers is entering its next chapter in partnership with the global investment firm 3G Capital"
- Robert Greenberg, CEO, Skechers
The bottom line...
3G Capital’s $9.4 billion take-private of Skechers marks a bold entry into global consumer retail for the PE firm best known for food and QSR deals. Despite strong fundamentals and record DTC margins, Skechers traded near a 1-year low amid supply chain concerns and tariff-driven uncertainty—creating a timely value opportunity for a financial sponsor. The deal reflects rising private equity interest in global, high-margin brands and continued consolidation in the broader footwear and athletic apparel industries. For Skechers, private ownership under a single long-term sponsor enables strategic focus away from short-term public pressure. However, 3G’s limited apparel experience and history of aggressive cost-cutting introduce execution risk in a fast-moving, globally integrated business.
