UPDATE 2-Iconix buys global rights, ups stake in Ed Hardy brand
* Deal worth $55 mln plus $7 mln in earn-outs
* Increases stake to 85 pct from 50 pct
* Raises FY view on Ed Hardy deal
* Ed Hardy to add $15-16 mln in annual royalty rev
* Shares rise 5 pct to year high (Adds stake details, share movement)
April 27 (Reuters) - Iconix Brand Group Inc acquired the worldwide rights to American tattoo artist Don Ed Hardy's brand from Nervous Tattoo in a $55 million deal that raised its stake in the brand to 85 percent.
Iconix, which acquired a 50 percent interest Hardy Way LLC -- owner of the Ed Hardy brand and trademarks -- in 2009, also raised its full-year expectations to reflect the acquisition. [ID:nASA01ZS4]
News of the acquisition, coupled with strong results, drove Iconix's shares up 5 percent to $23.56 -- their highest in over three years.
On a pro-forma basis, Iconix expects the Ed Hardy brand to generate total annual royalty revenue of about $15-16 million. The deal also included a $7 million earn-out.
Don Ed Hardy will retain a 15 percent minority interest.
Nervous Tattoo will continue as a licensee for Ed Hardy t-shirts, hats and hoodies and pre-pay $7 million in royalties under its license.
Iconix, which posted better-than-expected quarterly results driven by strength across its brand portfolio, owns and licenses brands including Candie's, Joe Boxer and Badgley Mischka and sells its products at Target Corp , Wal-Mart Stores Inc and Kohl's Corp among others.
"We also expect to continue to be acquisitive," said Iconix Chief Executive Neil Cole, the brother of American designer Kenneth Cole. (Reporting by Viraj Nair in Bangalore; Editing by Roshni Menon)