Polo Ralph Lauren Corporation has reached a US$47m agreement to assume direct control of its wholesale and retail distribution in South Korea from its licensee there.
It takes control from Doosan Corporation from January 2011. Doosan currently distributes Polo Ralph Lauren product through approximately 175 shop-in-shops and five freestanding locations in the country.
The total purchase price will comprise of a cash payment of $25m for certain assets plus an additional payment estimated at $22m for primarily inventory.
“Expanding and elevating our international presence is one of our highest strategic priorities,” said Ralph Lauren, chairman and CEO.
“South Korea is one of our largest markets, and has always been an important territory for us. It remains one of the world’s most vibrant markets for luxury goods. South Korean consumers have developed a strong appreciation for our iconic lifestyle sensibility and we are excited to build on this success.”
“Polo Ralph Lauren has a history of success in South Korea and we want to thank the Doosan Corporation and their employees for their commitment and dedication to the development of our brands in this market over the last 12 years,” said Roger Farah, president and chief operating officer.
“Assuming control of South Korea is another important milestone in our broader Asian growth strategy. It is a major piece of the strategy that enables us to directly operate all of Asia with greater consistency across all markets and channels in a manner that is more closely aligned with our global brand positioning and objectives.”
The company launched its Asian strategy with the acquisition of a Japanese unit in 2007, which has been followed recently by acquisitions in China, Hong Kong, Indonesia, Malaysia, the Philippines, Singapore, Taiwan, and Thailand.
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