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Crocs CEO John McCarvel To Retire; Reports Financial Partnership With Blackstone

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12/29/2013 10:29 PM ET

Crocs, Inc. (CROX: Quote) announced the financial partnership with Blackstone (BX: Quote). Crocs also revealed that John McCarvel planned to retire as president, chief executive officer and board member on or about April 30, 2014. The company said that the board has begun an outside search for McCarvel's replacement.

The company said that an investment fund affiliated with Blackstone has agreed to buy $200 million of newly issued series A convertible preferred stock.

In connection with the investment, Crocs intends to revise its capital structure to accommodate a $350 million stock repurchase program approved by its board of directors. Consummation of the investment is expected to close in January 2014.

Crocs also updated its fourth quarter 2013 outlook and currently expects revenue to be at the low end of prior guidance range of $220 million and $225 million, and loss per share to be at the low end (meaning the higher loss) of the previously provided guidance range of $0.20 and $0.23.

On average, nine analysts polled by Thomson Reuters expected the company to report revenues of $222.25 million for the fourth quarter. Analysts' estimates typically exclude special items.

Excluded from this outlook are all costs and expenses associated with the Blackstone transaction. The company expects the aggregate charges in the fourth quarter to be in a range of $47 million to $52 million, which is an additional loss per diluted share of $0.45 to $0.50.

"As we look forward, 2014 will be a significant transition period for the company. We will recruit a new CEO who will work with the reconstituted board to refine our short-term and long-term strategic plans, which will include a sharper focus on earnings growth with less emphasis on top-line growth. We will focus on improving financial performance, particularly in the Americas and Japan, as well as enhancing our global retail execution", said Thomas J. Smach, Crocs chairman of the board.

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by RTT Staff Writer

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