A landmark deal reshaping the global footwear industry has emerged as US-China trade tensions continue to ripple through Asia's manufacturing hubs. Skechers, America's third-largest footwear company, announced its sale to private equity firm 3G Capital in a $9.4 billion transaction this week. The move follows sustained pressure on US shoe brands from tariffs imposed during the Trump administration, nearly all targeting products manufactured in Asia.
Under the agreement approved Monday, 3G Capital will pay $63 per share for Skechers. CEO Robert Greenberg will remain to oversee operations as the company transitions to private ownership. While neither party explicitly cited tariffs as motivation, industry analysts immediately connected the sale to mounting trade pressures – 97% of Skechers' 2024 production occurred in Asian factories, with two-thirds of its $9 billion annual revenue coming from international markets.
The deal arrives during unprecedented sector turmoil. On April 29, Skechers joined Nike, Adidas, and 80+ footwear brands in warning that Trump-era tariffs imposed on Asian-made goods created an "existential threat" to US companies. A coalition letter to the White House revealed children's footwear now faces duties ranging from 150% to 220%, costs companies argue cannot be absorbed without consumer price hikes or production cuts.
"These tariffs remove the business certainty needed for capital investments in US production," stated the Footwear Distributors and Retailers of America in its appeal. The group cautioned that rather than reviving domestic manufacturing, the policy risks triggering job losses and reduced consumer spending across the $90 billion US footwear market.
Skechers' financial trajectory underscores these concerns. Despite reporting record $640 million net earnings in 2024, its stock price dropped 22% over the past year as tariff uncertainties grew. First-quarter 2024 results fell short of Wall Street expectations, prompting the company to withdraw its full-year financial outlook.
CFO John Vandemore described confronting "macroeconomic uncertainty mirroring pandemic conditions," with the company implementing cost-sharing agreements with Asian suppliers and incremental price adjustments to offset $300 million in annual tariff expenses.
As 3G Capital prepares to finalize the acquisition by late 2024, market watchers warn Skechers' transition to private ownership could signal broader consolidation moves among tariff-impacted brands maintaining Asia-centric supply chains.
