Friday, April 20, 2007

Foot Locker Trying to Buy Genesco: It Aint Over Yet

I told ya this was gonna get greasy:

So it turns out that the rumor of Foot Locker wanting to buy Genesco (you probably know this company from its Journey's or Underground Station stores) are true. What happened was that the CEO of Foot Locker, Matt Serra, made an offer earlier this month, which the CEO of Genesco, Hal Penningto, treated like an unsolicited email from a Nigerian investor. So Matt went and took his offer to the street so that the people could decide. 'Cause, after all, Genesco is a publically held company and as such the shareholders do have a say.

Here's the excerpt from the letter in which Matt snitches out Hal:

Serra wrote: "Given Genesco's failure to provide a substantive response to my April 4 letter and recent public speculation, we thought it would be best for both of our organizations, and our respective shareholders, to make our position public."

I have no idea how this deal is going to go down, but I will tell you that the thought of Foot Locker owning Genesco sickens me. And I am not unilaterally opposed to big companies expanding through purchases--it's the nature of the beast when you're a publically-held company: grow or die. For example, I think PPR's purchase of Puma will go down in history as a great one. Same with Nike and Converse. But Just like Adidas buying Reebok, something in my gut tells me that this move will ultimately not be a good one for any of the parties involved and for retail in general.

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