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Footwear and apparel company Wolverine World Wide has sold Sperry to brand management firm Authentic Brands Group.
Sperry, best known for its boat shoes and loafers, saw sales drop by more than 40% in the three months ended Sept. 30.
Retailers have been looking to carve out underperforming assets and reinvest in growth drivers against an increasingly uncertain economic backdrop.

Sperry Top-Sider Bill fish Tan and Beige.
Mayra Beltran | Houston Chronicle | Getty Images

Wolverine World Wide has sold Sperry to brand management firm Authentic Brands Group and Canadian retailer the Aldo Group, the company announced Thursday.
The deal will generate $130 million, which Wolverine plans to use to pay down debt, it said.

Wolverine originally acquired Sperry in 2012 from Payless ShoeSource owner Collective Brands in a $1.23 billion deal that also included Saucony, Stride Rite and Keds. 
The terms of the partnership between Authentic and Aldo weren’t immediately clear. The two companies already work together, with Aldo helping Authentic run brands like Roxy and Brooks Brothers.
Wolverine, which runs a portfolio of apparel and footwear brands that includes Merrell, Hush Puppies and Sweaty Betty, said in May it was seeking strategic alternatives for Sperry after it realized the investments the segment needed would be better served in other parts of its business. 
“It just became apparent that Sperry was going to continue to require investment that was going to take away from where we think the upside is,” Wolverine’s then-CEO, Brendan Hoffman, said on a call with analysts in May after the company reported fiscal first-quarter earnings. 
He said the decision would allow Wolverine to put more resources behind expanding Merrell’s lifestyle business, extending Saucony’s reach beyond its core active and lifestyle consumers, and stabilizing Sweaty Betty’s home market in the U.K. and Ireland. 

Retailers slim down

Wolverine’s decision to sell Sperry comes as retailers look to streamline their businesses and focus on growth drivers by carving out their underperforming assets as they navigate an increasingly uncertain economy. 
In November, Calvin Klein’s parent company, PVH, sold a trio of lingerie and intimates brands – True & Co., Warners and Olga – to Basic Resources for $160 million. Walmart, meanwhile, offloaded Moosejaw, Bonobos and Eloquii in a series of transactions earlier in the year. 
Before its decision to sell Sperry, Wolverine made a deal to sell Keds to Designer Brands, the parent company of DSW, for more than $90 million. It sold the Hush Puppies intellectual property in China, Hong Kong and Macao for $58.8 million. It also has plans to sell its U.S. Wolverine Leathers business for $6 million. 
The retail industry has seen consumers pull back on spending as they face persistent inflation, high interest rates and most recently, the resumption of student loan payments. But the footwear and apparel sectors have felt that pressure acutely.
Foot Locker has reported quarter after quarter of sales declines, and even Nike has started a $2 billion restructuring as it prepares for what it called a “softer” revenue outlook.
In the three months ended Sept. 30, Sperry posted just $46.2 million in revenue, a 41.4% drop from the year-ago period, when it saw $78.9 million in sales. 
While slow sales at Sperry have dragged on Wolverine’s overall business, the downturn has created an enticing entry point for Authentic, which is in the business of buying struggling brands at attractive valuations and then putting in the resources necessary to revive them. 
In November, CNBC reported that Authentic competitor WHP Global was also interested in buying Sperry. At the time, GlobalData retail analyst Neil Saunders said Authentic’s and WHP’s interest in Sperry, as well as Hanesbrands’ Champion line, made “perfect sense.” 
“They have a good operational backdrop that they can integrate these brands into, whether that be through licensing, through international expansion, through getting them into physical retail more, through selling them direct to consumer,” Saunders said previously. “They almost have an operating model that you can just sort of drop brands into and start seeing better performance.”  More

SpaceX successfully sent text messages via Starlink satellites using T-Mobile’s network, as Elon Musk’s company aims to bring its direct-to-device cell service to market in the coming year.
The company launched its first Starlink satellites with direct-to-device, or D2D, capabilities last week.
SpaceX plans to begin offering D2D text service this year and expects to expand with voice, data and internet of things services in 2025.

SpaceX founder Elon Musk and T-Mobile CEO Mike Sievert on stage during a T-Mobile and SpaceX joint event in Boca Chica Beach, Texas, on Aug. 25, 2022.
Michael Gonzalez | Getty Images

SpaceX successfully sent text messages via Starlink satellites using T-Mobile’s network, it announced Wednesday, as Elon Musk’s company aims to bring its direct-to-device cell service to market in the coming year.
The recent test comes as major players pursue the market to connect unmodified phones directly to satellites, a nascent subsector of the space economy.

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SpaceX last week launched the first six Starlink satellites equipped with direct-to-device, or D2D, capabilities, after receiving authorization from the Federal Communications Commission last month to test the technology.
The company said it performed the texting demonstration on Monday — in which SpaceX “sent and received our first text messages to and from unmodified cell phones on the ground to our new satellites in space” — and declared the test “validates” that “the system works.”

The company said “there is incredible demand and high interest” in adding D2D capabilities to its Starlink network, noting its partnerships with mobile operators including T-Mobile, Canada’s Rogers, Australia’s Optus and Japan’s KDDI.
SpaceX plans to begin offering D2D text service this year and expects to expand with voice, data and internet of things services in 2025. So far, the company has grown Starlink internet service to a network of more than 5,000 satellites in orbit, boasting more than 2.3 million customers worldwide.
Several smartphone makers, service providers and satellite companies have partnered on rolling out D2D service. For example, Apple is spending heavily to provide its “Emergency SOS with Satellite” service, which it rolled out with iPhone 14 models, thanks to work with satellite operator Globalstar.

Qualcomm ended its partnership with satellite communications company Iridium late last year, with the latter on Wednesday pivoting to a new effort it calls “Project Stardust.” Iridium plans to test its D2D service in 2025 and begin rolling it out by 2026.Don’t miss these stories from CNBC PRO: More

LeBron James has signed a multiyear deal with Fanatics Collectibles.
The Los Angeles Lakers star had spent two decades with rival Upper Deck.
James and Fanatics will release their first card together Jan. 19.

LeBron James signs with Fanatics Collectibles in a trading card deal, leaving Upper Deck after 20 years.
Courtesy: Fanatics

LeBron James is moving his trading card sponsorship to Fanatics Collectibles after more than 20 years with rival Upper Deck.
Fanatics will kick off the deal by selling a unique Bowman brand card featuring a dual autograph of the National Basketball Association legend and his son Bronny. It will be available for retail beginning Jan. 19.

The multiyear deal will mean new inventory of signed James trading cards. James hasn’t autographed official cards over the past couple of years. It also shakes up the balance of power in the recently revived sports memorabilia and trading card industry.
“Our goal is to push the envelope of where the hobby can go and are excited about how our collaboration with one of the best athletes in the world will continue to ignite fan and collector passion,” said Fanatics Collectibles CEO Mike Mahan.
Terms of the deal were not disclosed. Experts say the deal could be worth more than $5 million per year.
As part of the launch, James voiced a short video titled “Origin of Greatness,” focusing on the first moments of several Fanatics athlete partners and their journey to the top of their sport.
“As someone who appreciates all the moments — big and small — along the journey, I’m excited to share more with my fans through this partnership with Fanatics,” James, 39, said in a statement.

Fanatics Collectibles, under Michael Rubin’s $31 billion sports platform company Fanatics, purchased Topps in 2022 for $500 million.

Arrows pointing outwards

Fanatics will replace Panini as the official trading card maker for the NBA and its players association starting in 2026. Fanatics will now have the exclusive on printing cards of James, a four-time NBA champion. Despite exclusivity agreements, league partners have been able to print cards in the past.
The trading card rivals are currently engaged in a courtroom battle, with Panini accusing Fanatics of antitrust violations.
Fanatics Collectibles has also secured long-term, exclusive rights to design, manufacture and distribute trading cards for other sports properties, including Major League Baseball, the Major League Baseball Players Association and the National Football League Players Association.
The deal with the Los Angeles Lakers star is a big win for Fanatics, as James is the most valuable athlete of all current NBA players, according to Ken Goldin, founder and CEO of Goldin Auctions and star of Netflix’s “King of Collectibles” series.
Goldin said he sold a high-grade James card for as high as $5 million at the beginning of James’ career.
Today, he said prices have come down but that his cards are still extremely valuable. He also said he’s optimistic for what this deal will mean for collectors.
“They’re [Fanatics] probably going to utilize LeBron in a way not just to sign autographs, but to help promote trading cards as a whole,” Goldin said.
When James signed his first contract with Upper Deck in 2003, it was believed to be the largest in trading card and memorabilia history. James was reportedly paid $1 million per year and also received a $1 million signing bonus.
“Upper Deck has had the privilege of working closely with LeBron James over the last 20 years, building the LeBron James brand into one of the most valuable collectible brands in the world,” the company said in a statement.
This is not the first time James has left one of his major sponsors for a competitor. The 19-time NBA All-Star left Coca-Cola after almost 18 years to sign an endorsement deal with rival Pepsi in 2021.Don’t miss these stories from CNBC PRO: More

The Messenger is forecasting advertising revenue will surge from $3.8 million in 2023 to more than $55 million in 2024.
The struggling news outlet is looking for a cash infusion of $20 million for equity in the business.
The Messenger plans to add 19 more employees to launch Messenger TV despite barely having any cash left by the end of 2023.
The company had planned to cut 40 jobs in 2024 and furlough an additional 15 employees, but those figures have been dialed back.

Screenshot of the TheMessenger website.
Source: TheMessenger

The Messenger, the struggling news media startup co-founded by publishing veteran Jimmy Finkelstein, is urging potential investors to make a long-shot bet on a dramatic rebound in advertising this year.
The company is attempting to stop the cash burn that has put it in jeopardy.

CNBC has obtained an investor deck The Messenger was using as recently as late December to entice potential individuals or companies to infuse it with $20 million.
The Messenger, which started in May, launched on the idea of becoming a down-the-middle digital news juggernaut. It initially planned to hire around 550 journalists and generate over $100 million in revenue in 2024, according to The New York Times. The company ended up hiring a staff of 300 people and has since struggled financially, which has led to some recent layoffs, according to multiple reports.
The Messenger ended 2023 with a net loss of $43 million, according to the documents. The deck tells investors that with the infusion, the company plans to end 2024 profitable, with net income of $13 million.
The Messenger confirmed to CNBC that the deck was part of a “draft presentation,” and said there have been “adjustments” to the numbers within the documents and that the company intends to “make $13 million and be profitable in 2024.”
“It should also be pointed out that our traffic is growing at an enormous pace. Comscore latest numbers show that we generated 88 million page views in November, and Google Analytics shows that we generated 100 million page views in December. Our traffic is growing at 30% a month, already putting us ahead of many major news publications,” the company spokesperson said in a statement to CNBC.

The documents say that The Messenger is planning to eliminate 40 positions and furlough 15 people for four months this year amounting to an estimated $6.2 million in annual savings.
That’s one of the details that’s since changed, according to a spokesperson. The company laid off about 25 people last week to save cash, as first reported by The New York Times.
“The layoffs impacted two dozen people, not 40, which was one of the adjustments made to the presentation,” the spokesperson said.

Betting on advertising turnaround

The immediate turnaround will be based on what could be an insurmountable climb in advertising sales. In 2023, The Messenger took in $2 million in direct ads and $1.8 million in programmatic advertising. This year, The Messenger forecasts it will bring in more than $18 million and $37 million for each, respectively.
“By 2024 The Messenger will be a known brand in the United States which users will know and make part of their daily media consumption habit,” the company says in its investor deck. “The attention paid to media in 2024 is expected to be very high. We have a critical U.S. Presidential Election in 2024 with political and related news content in high demand as well as news events such as debates, primary voting, and conventions.”
While U.S. companies are counting on political advertising to boost sales in 2024, digital media companies that rely on advertising have been ravaged for years by Google, Facebook and Amazon, which have sucked up available inventory. This has crippled companies such as Vice Media and BuzzFeed, which grew too quickly amid advertising revenue declines.
The Messenger will be relying on Google search to drive programmatic advertising. On the direct side, $10 million of The Messenger’s forecast $18 million will come from Messenger TV, a yet-to-be-launched service that will require 19 additional employees, the presentation shows.
Most of the Messenger’s expense has been head count; it spent about $39 million in 2023 to hire hundreds of employees.
Despite the hope of a financial turnaround, the deck indicates that there is no plan for The Messenger to cut back on millions of dollars in spending. For instance, with the creation of Messenger TV, overall personnel expense will rise to more than $48 million in 2024.
The Messenger expects to have open its three facilities in New York, Washington, D.C., and West Palm Beach, Florida, according to the deck. The facilities payments are estimated to exceed just over $240,000 each month this year.
Travel, meals and entertainment expenses at The Messenger are estimated to be more than $1.7 million by the end of 2024, with the company expected to spend over $140,000 each month of 2024.
The Messenger highlighted the severity of its cash problems and illustrated the tough sell it will have to make to investors for more money.
The company had negative cash flow of $3.8 million in October, according to the deck. It then added $5 million in November and an additional $1.7 million in “incremental investment” to stem the cash burn.
But the business has already incinerated the incremental investment in two months, the deck says. The Messenger ended December with $667,000 in cash. It plans to end January with monthly cash burn of $4.2 million, pushing the company into negative cash territory by the end of the month.
While The Messenger plans for the advertising market to turn later in 2024, it acknowledges the business will likely hemorrhage cash in the coming months.
Without additional investment, The Messenger predicts, its ending cash balance by June will be negative $16 million. The company predicts operations will generate positive free cash flow in August. More