LONDON: Coats Group plc said Wednesday it will acquire OrthoLite Holdings LLC, the global leader in premium insoles, for $770 million, as part of its strategy to expand in the high-growth footwear component sector.
The deal, expected to close in the fourth quarter of 2025, will be funded through a mix of new debt facilities and an equity placing of up to 19.99 percent of Coats’ issued share capital. The equity placing will be launched via an accelerated bookbuilding process, with a separate offer to retail investors to follow.
OrthoLite, which supplies over 500 million pairs of insoles annually to 550 global brands, brings a 36 percent market share in the open-cell foam insole category. The acquisition will make Coats a “super tier 2” supplier by expanding its footwear division and product offerings.
The transaction includes an initial enterprise value of $770 million, with an additional contingent payment of up to $10 million based on OrthoLite’s 2025 EBITDA performance. Coats expects to deliver $20 million in joint annualized cost synergies by 2028, reducing the EV/EBITDA multiple from 10.0x to below 8.0x post-synergy.
“This is fantastic news for both companies and for the footwear industry,” Coats CEO David Paja said in a statement. “Together, we’ll reshape the future of the footwear components industry.”
Glenn Barrett, founder and CEO of OrthoLite, called the merger “a powerful partnership of industry leaders,” and said it will support innovation and sustainability through OrthoLite and its Cirql technology—a recyclable foam midsole solution.
The acquisition will increase Coats Footwear’s pro-forma revenues to approximately $700 million. Coats expects the deal to be earnings accretive from year one, with ROIC surpassing WACC by 2028.