Iconix Gets A True Icon
This morning’s announcement of the purchase of the Peanuts characters and United Media Licensing by a joint venture formed by the heretofore fashion-centric Iconix Brand Group and the family of Peanuts icon Charles Schulz is indeed a stunner. There have been many rumored suitors since UM parent E.W. Scripps announced earlier this year that it was looking to dispose of the company, but Iconix – which has never come anywhere close to the character business – isn’t one of the names we’ve heard mentioned.
The disposal of UM was always going to problematic because the overwhelming part of its business comes from the Peanuts gang, so any buyer was going to have to get the approval of the Schulz family. Iconix apparently succeeded by forming a joint venture with the Schulz clan that gives the family a 20% stake in the business. That business also includes the other acquired assets, such as UM’s representation of such properties as Dilbert and Fancy Nancy.
How extensive is the Peanuts business via UM? According to this morning’s release, “Peanuts has a strong diversified global licensing platform with over 1,200 licensing agreements including relationships with MetLife, Hallmark, Universal Studios, Warner Bros., Cedar Fair, H&M, Benetton, Old Navy, CVS and Walgreens. The Peanuts brand is licensed in over 40 countries and generates annual retail sales of over $2 billion.” Iconix says it expects the acquired business to generate $75 million in royalties this year.
This is the third significant joint venture that Iconix has formed in the past several months. One was the establishment of its business in China with a local partner. More recently, it formed a joint venture with The Licensing Company (TLC) to market its brands in Europe.
In the release announcing the deal, Iconix says the transaction “moves Iconix well beyond fashion into a true global brand management entity with a wide variety of agreements that range from theme parks to media to financial institutions. It also extends our international platform with Peanuts licensed in over 40 countries and approximately two-thirds of its revenue coming from outside of the U.S. After closing this transaction, Iconix will be diversified with fashion only representing approximately two-thirds of our revenue. Further, we believe Peanuts’ large global footprint and broad licensing relationships will also open up new doors for our existing portfolio of brands and future acquisitions.”