Alloy Buys Old Glory for $9.6M
The New York company paid $9.6 million in cash for Old Glory Boutique Distributing Inc., an acquisition that brings apparel, accessories and collectibles with music and entertainment themes.
"It's an extension of our youth market direct marketing franchise," said Sam Gradess, chief financial officer of Alloy. "It's a product category or merchandise that we presently have not tapped into."
Old Glory sells licensed rock 'n' roll merchandise through a store, catalog and OldGlory.com. It has a database of 300,000 names at mailing addresses that will be melded with Alloy's database of 12.5 million consumers, 3 million to 4 million of which also offer e-mail addresses. Its customers are 60 percent female, ages 25 to 55 with an average household income of $75,000.
Old Glory, Old Saybrook, CT, has six employees excluding fulfillment staff. Those not laid off will be offered a chance to move to Alloy's offices in New York. In the spring, fulfillment operations will move to Alloy's warehouse in Portland, TN.
Alloy will retain the Old Glory name. The catalog will be used to boost Alloy's sponsorship revenue, adding value to clients in the music and entertainment space.
Gradess would not disclose Old Glory's anticipated sales this year but expected Alloy's merchandise revenue for fiscal 2003 to grow by $8 million to $10 million because of the acquisition.
The acquisition is Alloy's second this year. The company in March paid $7 million for Girlfriends LA as it bolsters its hold on youth-focused direct marketing.