Brand acquisition and management company Aether Holdings has entered a definitive agreement to buy athletic shoe and apparel franchise system The Athlete's Foot.

The acquisition includes The Athlete's Foot and global retail franchise operations. It follows Aether's purchase of UCC Capital in June, which gave it a platform to implementing a new intellectual property strategy.

"The Athlete's Foot is a retail brand that is recognised by consumers worldwide," said Robert W D'Loren, Aether's president and CEO. 

"This franchise system will provide us not only with a historical and growing revenue stream, but also a flexible distribution channel for additional consumer brands that we plan to acquire in the future."

The US$51.5m transaction is "an exciting first step" to creating a wide portfolio of brands and assets, D'Loren added.

President and CEO Robert J Corliss will continue with Aether after the closing as president and CEO of Aether's retail franchise division, NexCen Franchise Brands.

Corliss said: "Our long-standing relationship with Bob D'Loren and UCC has served The Athlete's Foot well over the past several years.

"We clearly envision successfully working together with Aether to expand and further enhance The Athlete's Foot brand globally."

Aether intends to start doing business as NexCen Brands, which is more indicative of the Company's new business focus.

Aether will pay $51.5m and has also agreed to an earn-out arrangement that will entitle the seller to receive up to an additional $8.5m of cash and stock (in the same proportion as the initial consideration), if The Athlete's Foot's financial results for the year ended 31 December 2006 meet certain specified targets. 

The transaction is expected to close before the end of 2006.