Buying Aquascutum without the Japanese licence (1990)

The author’s view

A company that had never raised designers of its own buys a marque with pedigree from outside. As choices went in 1990, that was reasonable: the twenty-eight brands launched at once in 1985 had failed, so the verdict on building in-house was already in. What made it possible was that non-operating income could still manufacture an ordinary profit, and that the death of Onoe Kiyoshi in 1988 had removed the weight that held the company in check. The question is how much of the Japanese rights position could really be verified in the four days it took to close.

The pedigree it bought grew, once the licence came back, into a business of some ¥10bn — so the acquisition was not a failure. But after a further ¥6bn was poured in over the three years from 2006, the sale was decided in 2008: an asset the company had cultivated was let go to fund the parent’s own cash needs. Buying a brand presupposes the strength of the core business that carries it. When that premise fails, the better the brand has grown, the sooner it becomes the thing turned into cash. That relationship is what the nineteen-year round trip demonstrates.