Let’s take a quick look back: In January 2024, the takeover by the Arklyz Group was announced; The closing was announced for the end of March. But that took a few weeks longer. Why?
An M&A process like this, which I also took part in for the first time, is very extensive. We have a factory in India, one in Romania, and we have international sales companies – all of this has to be screened in such a way that a buyer has security and is not confronted with surprises. Incidentally, this is also in the seller’s interest.
At that time it was announced that the fundamental elements at Lloyd would not change after the takeover; The name remains, as does the company headquarters in Sulingen. In which areas have changes been made?
Lloyd is still as Lloyd is known. There are areas and departments that have experienced a revival. And that’s a good thing. Triggered by the Corona crisis, we had four years of constant crisis mode behind us, which incidentally led to us getting into this situation in the first place and the Ara Group deciding to take a different path. The constant crisis mode is now followed by a mood of optimism. This worked well with Param Singh. Of course, many were skeptical and it will still take a lot of effort and effort to put everything that has been pushed into practice. But we were able to convince more and more people, both internally and now offensively also externally, of the new path. We now have to prove that it works. But that’s normal with every takeover and every change.
Arklyz was also concerned with increasing operational efficiencies. What does that mean?
We benefit greatly from the international connections that Param Singh has. We assume that we can generate faster international growth through these connections. The first contacts have been made. The first contracts have already been concluded. Preparations are now underway to implement the measures that will lead to positive results in 2026.
How did 2024 go for Lloyd?
2024 was initially very positive, but unfortunately it didn’t continue as we had hoped. We don’t have final numbers yet, but it’s definitely been a very challenging year. We haven’t quite reached the 2023 numbers, which has to do in particular with structural changes in the market. Due to the loss of some retailers, sales that had developed relatively well in 2023 were no longer available to us. The Eastern European business, especially the Russian business, is still under massive pressure. These are developments that we were not able to absorb all of.
At the closing, a statement said that Arklyz also plans to expand its presence in the sports and lifestyle market through the acquisition of Lloyd. What role does the sports sector play specifically?
The Arklyz Group is very active in the sports sector and has many sports and sneaker stores. But there are no plans for us to become a sports brand. But the fact that we will develop from the fashion segment into a lifestyle brand is a firm plan. However, our products will not be found in performance sports stores in the future. Of course we will expand our sneaker share again. We have a 40% sneaker share sold for the S/S 2025 season. This is a result that we want to stabilize for F/W 25/26 because this is the shoe group that works best at the moment.
Expansion into China was planned some time ago. What is the situation today?
We have a partner in China who opened a total of nine stores within two years in the years before Corona. Then the Corona crisis also hit China quite hard and our partner had to consolidate. At the moment we have four stores in northern China that this partner operates. Just recently one of the shops within a shopping center was moved to a better location and redesigned. We are in discussions to clarify how we want to operate with our new set-up in the future. Our partners were thrilled by our new appearance. Chinese people love change. These are ideal conditions for us. Apart from our partner in China, we are in the process of checking and jointly identifying Param Singh’s contacts.
For China, we are also considering having lifestyle products that go beyond shoes produced under license. Because the business there doesn’t just have to do with fashion standards, but also with fits. You have to be prepared for this if you want to be successful in China. I assume that we will be able to show the first results in 2026.