An asset reshuffle involving three of Brazil’s leading footwear manufacturers will result in Vulcabras Azaleia focusing on sports with its Olympikus brand and the distribution of Under Armour in Brazil, while getting out of the women’s sector and taking over a Mizuno license from Alpargatas, which will concentrate on its key brands, including Havaianas.
Vulcabras has bought Alpargatas’ rights to manufacture and market the Mizuno brand for 32.5 million reais (€5.0m-$5.8m) The license covers Brazil and Argentina. In turn, Alpargatas is concentrating on the Havaianas and Osklen brands as well as the internationalization and digitalization of its business.
Meanwhile, Grendene has signed a license agreement for the Azaleia brand of women’s shoes owned by Vulcabras. The three-year agreement, which can be renewed for an additional three years, covers the production and sale of women’s shoes in Brazil and worldwide, except in Peru, Chile and Colombia, where the Azaleia brand has a network of more than 70 stores, according to Vulcabras’ website. The label is present in more than 20 countries. In Brazil, it can be bought through the brand’s online store and in over 12,000 physical shops.
The license agreement is in line with Vulcabras’ decision to focus on manufacturing and marketing sports shoes, while continuing to sell women’s shoes only in the South American countries excluded from the exclusivity contract with Grendene. Meanwhile, Grendene, which is known for brands such as Melissa and Ipanema, reinforces its women’s portfolio.
Vulcabras is also scheduled to discontinue a small brand of girl’s shoes, Dijean, which could be sold if a buyer is found. It may be interesting to note that both Grendene and Vulcabras are controlled by members of the Grendene family.
For Vulcabras, these moves signal a return to its focus on the athletic footwear sector, which the group cultivated in the 1970s by signing agreements for the distribution in Brazil of brands like Adidas, Puma, Le Coq Sportif, Lotto and Reebok. Gradually, the distribution of these brands was discontinued in the subsequent decades as the group concentrated its efforts on its own Olympikus brand, first launched in 1975.
According to the Brazilian press, the reshuffle will boost Vulcabras’ revenues as the Azaleia brand only generates annual sales of around BRL 100 million (€15.5m-$18.0m) per year against BRL 444 million (€68.6m-$79.8m) for Mizuno. The company’s production lines dedicated to women’s shoes will be converted to the manufacturing of sports shoes.
Like Olympikus’ shoes, some of Mizuno’s styles sold in Brazil are already made locally because of the Brazilian anti-dumping duties on shoes imported from China.
Vulcabras, which insists on manufacturing as much footwear as possible in Brazil, has been reorganizing its activities recently, reducing the number of factories to two from three after selling a plant located in Sergipe. The company is concentrating manufacturing at enlarged plants in Ceará and Bahia, which now measure 70,000 and 50,000 square meters, respectively.