Coats Group, a renowned UK-based manufacturer specializing in industrial threads and footwear components, is undergoing a major restructure by divesting its zips business. The company has announced the sale of its European Zips business to Germany’s Aequita for an estimated $1 million, taking into account “typical debt-like items.” The transaction is expected to be finalized in the third quarter.

This decision aligns with Coats’ strategic initiatives, unveiled in March 2022, which aim to optimize the company’s portfolio, enhance its footprint, and improve overall cost base efficiency. According to Coats, the European Zips business generated approximately $50 million in revenues for the year ending December 31, 2022, with operating margins lower than the group average.

Just last week, Coats Group established a new footwear division following the acquisition of Texon and Rhenoflex in 2022. After an integration phase, Coats launched Coats Footwear, positioning itself as a global powerhouse in the industry. Through this division, the company will offer an expanded range of components and material solutions, along with unparalleled expertise and technical knowledge, to footwear and accessories producers worldwide.

Coats’ decision to divest its zips business showcases its commitment to streamlining operations and focusing on areas with higher growth potential. By shedding this underperforming business, the company can allocate its resources more strategically, driving profitability and innovation.

The sale of the European Zips business to Aequita will not only provide Coats with an infusion of capital but also allow Aequita to leverage the existing market presence and customer base of the zips business.

Coats’ recent acquisitions of Texon and Rhenoflex and the subsequent establishment of Coats Footwear highlight the company’s dedication to expansion and diversification. By offering a comprehensive range of components and material solutions, Coats Footwear aims to become a leading provider in the footwear industry.

Leveraging its global reach and expertise, Coats is poised to serve footwear and accessories producers with high-quality products and innovative solutions through Coats Footwear. The company’s longstanding reputation for excellence in the industry positions it for success in this new venture.

The divestment of the zips business marks another milestone in Coats’ transformation journey. By optimizing its portfolio and focusing on areas of strength, the company is setting itself up for sustained growth and profitability. Coats’ strategic initiatives and restructure reflect its unwavering commitment to delivering value to shareholders and stakeholders alike. Moving forward, the company will continue to prioritize innovation, efficiency, and customer satisfaction in all its operations.

Useful links:
Coats Group Official Website
Aequita Official Website