The Japanese athletic footwear company Asics announced Wednesday it will separate its profitable Onitsuka Tiger brand into an independent subsidiary to enhance decision-making speed and strengthen market competition.
Company stock climbed 2.7% during late morning Tokyo trading, outperforming the broader TOPIX index which declined 0.7%.
The restructuring will move the Onitsuka Tiger operations to OT Group Corp, a completely owned subsidiary, through a corporate division that takes effect January 1st, according to the company’s announcement.
The brand has served as a major growth engine for the athletic company over recent years. Revenue from Onitsuka Tiger surged 43% year-over-year to 136.5 billion yen ($851.32 million) during the December-ending fiscal year, driven by robust European demand and tourist spending in Japan.
The Onitsuka Tiger division achieved a profit margin approaching 38%, ranking as the most profitable among the company’s five primary business segments.
The Japanese athletic wear and shoe manufacturer projected another record-breaking profit year during its February earnings announcement.
The brand, recognized for its vintage-style, clean aesthetic designs, originated from the company’s founding entity established in 1949 by Kihachiro Onitsuka, who believed creating athletic footwear would help develop healthy youth crucial for Japan’s post-World War Two recovery.
The founder created his initial basketball shoe design and chose the “Tiger” brand name, drawing inspiration from what he considered Asia’s most formidable animal’s power and speed.
($1 = 160.3400 yen)
