Searchlight Capital Partners L.P. has agreed to buy a majority stake in Roots Canada Ltd. Financial terms weren’t announced. Founded in 1973 by Michael Budman and Don Green, Roots is a leading lifestyle brand in Canada that sells leather bags, footwear, jackets, apparel, athletic wear, accessories, and home furnishings. Budman and Green will remain shareholders.
UPDATE: A prior version of this story said the name of the company was Roots. It is Roots Canada Ltd. The story has been changed.
TORONTO, October 26, 2015 – Together with the private investment firm Searchlight
Capital Partners, L.P., (“Searchlight”), Roots (the “Company”) Co-Founders Michael
Budman and Don Green announced today that they have concluded a formal
agreement with Searchlight to make a significant investment in the Company to support
the brand’s next phase of growth. As a result of the investment, Searchlight will hold a
majority stake in the Company.
Michael and Don, together with their wives, Diane Bald and Denyse Green, both of
whom have played important roles at Roots over the last 42 years, welcome this new
development for Roots, which they co-founded in Toronto in 1973. One of Canada’s
leading lifestyle brands employing more than 1,500 people in Canada; the Company
has 220 retail locations in Canada, the United States and Asia, along with a robust
ecommerce business. With its strong local and international relationships, as well as its
experience investing in other heritage brands, Searchlight believes it can add significant
value to Roots as the Company continues to expand.
“Don and I are extremely excited about this new development because of what it means
for the future of Roots,” said Michael Budman. “Before making this decision we had
extensive discussions and meetings with Searchlight’s co-founders, Erol Uzumeri and
Eric Zinterhofer, over a period of several months. We were impressed by how well they
understood and respected our brand. Not only do they have relevant experience,
international expertise and financial resources to draw on, but they are also committed
to Roots staying true to its longstanding values, culture and quality products.”
Don and Michael will remain actively involved in Roots and will be substantial
“We are thrilled by this partnership,” added Don Green. “We have partnered with the
Searchlight team as a result of their passion for Roots and their strong consumer
experience with other exceptional brands. We are excited about the future of Roots and
looking forward to working in collaboration with Erol, Eric and the rest of the team at
Searchlight to realize the brand’s significant growth potential.”
“Our investment will enable Roots to support its long-term growth ambitions,” said
Canadian Searchlight co-founder Erol Uzumeri. “As one of the few iconic Canadian
heritage brands, we see significant growth potential for Roots in both Canada and
internationally across multiple distribution channels. We look forward to working with
Michael and Don and the rest of the Roots team.”
Advisors to Don and Michael in the transaction include Goodmans LLP (legal counsel),
Generation Capital (financial advisors), WBM Partners LLP (financial and tax advisors),
and Threadstone Partners LP (financial advisors). Advisors to Searchlight Capital
Partners in the transaction included Torys LLP (legal counsel), Northwest Atlantic
(Canada) Inc. (retail estate advisors), KPMG (financial and tax advisors), AON
(insurance advisor), Category One (commercial advisors). The Toronto-Dominion Bank
is providing debt financing for the transaction.
Established in Toronto in 1973, Roots is Canada’s leading lifestyle brand, recognized
around the world for its quality merchandise – leather bags, footwear, jackets, apparel,
athletic wear, accessories, and home furnishings. Roots has 220 retail stores in
Canada, the United States and Asia, in addition to a successful ecommerce business. It
also has a state-of-the-art factory and distribution centre in Toronto, both located near
the company’s headquarters where all Roots products are designed.
About Searchlight Capital Partners, L.P.
Searchlight is a global private investment firm with offices in Toronto, New York and
London. Searchlight seeks to invest in businesses where its long term capital and
strategic support accelerate value creation for all stakeholders. For more information,
please visit www.searchlightcap.com.