MILAN, Italy — Tod’s SpA, the Italian maker of rubber-studded moccasins, said it may spin off its Hogan shoe brand on the stock market, shedding a unit that accounts for about a fifth of the company’s sales.
A company spokeswoman confirmed comments from Chairman Diego Della Valle at a Sept. 22 investor day that Hogan could be spun off “when ready.” The comments were attributed to Della Valle in a note by Citigroup Inc. analyst Thomas Chauvet.
Hogan has struggled over the past four years, hampered by efforts to tighten third-party distribution and high exposure to Italy. First-half revenue fell 5.8 percent at constant exchange rates, making the maker of 335-euro ($431) sneakers Tod’s worst- performing brand.
While Della Valle’s plans for Hogan include expanding its network of 10 directly-operated stores in China and diversifying into leather goods, “we remain skeptical on the brand’s ability to rapidly become a global brand,” wrote Chauvet, who recommends buying Tod’s shares.
Tod’s rose 0.7 percent to 80.55 euros at 9:28 a.m. in Milan, valuing the company at about 2.5 billion euros.
The Italian company may also buy back the license for the Roger Vivier brand from Della Valle ahead of its renewal due in December 2016, Chauvet said, citing management.
By Andrew Roberts; Editors: Celeste Perri, Paul Jarvis, Thomas Mulier