JPMorgan Chase is set to anchor a $6.5bn debt financing package to support 3G Capital’s proposed $9.4bn acquisition of Skechers, according to a report by Bloomberg citing sources familiar with the matter.
The financing, which is expected to launch shortly after the Memorial Day holiday on 26 May, comprises approximately $4bn in secured debt and $2.5bn in unsecured notes. The unsecured tranche is anticipated to include a payment-in-kind (PIK) toggle feature, providing 3G with additional flexibility to manage interest obligations via cash or additional debt issuance.
3G Capital aims to finalise the transaction – structured as a mix of debt and equity – by Q3, pending customary regulatory approvals.
News of the acquisition sent Skechers shares soaring on Monday, with the stock climbing on the back of a $63-per-share offer – representing a 30% premium to the company’s 15-day VWAP.
Skechers, founded in the early 1990s and headquartered in Manhattan Beach, California, is currently the world’s third-largest athletic footwear brand. The company has nearly doubled its revenue in the past five years and is targeting $10bn in sales by 2026, according to Bloomberg Intelligence.
The deal arrives at a pivotal moment for leveraged finance markets, which have begun to show signs of stabilisation following a volatile period triggered by renewed US-China trade tensions in early April. Several recent LBO financings were left “hung” amid the turbulence, with banks retaining unsold portions of debt on their balance sheets.
However, the successful syndication of debt supporting QXO’s acquisition of Beacon Roofing Supply late last month has renewed optimism.
Market participants will be watching closely as JPMorgan prepares to test investor appetite with the Skechers financing, which could provide momentum for clearing an estimated $5.7bn backlog in unsold LBO debt.
