Leading shoe manufacturer Phoenix Footwear Group Inc on Friday said it had agreed to buy casual and outdoor apparel brand Royal Robbins Inc.

The California-based company will pay $6m in cash and $500,000 in common stock at close, and a contingent payment of around $5m based on a two-year earn-out formula for the firm founded in 1968 by outdoor enthusiasts, Royal and Liz Robbins.

The deal, which is expected to close in the fourth quarter, will mark Phoenix’s entry into the men's and women's apparel category and is expected to boost annual sales by 30 to 40 per cent.

Phoenix has received a commitment from its lender for a new $24.75m credit facility and added the Royal Robbins line of apparel will compliment its recently acquired HS Trask and Ducks Unlimited footwear brands.

Chairman and CEO, James Riedman, commented: "We believe that today's acquisition will allow us to further enhance our profitability and provides us with a significant new growth vehicle.

"A well-known brand with strong sales and a loyal and growing customer base, Royal Robbins is the perfect compliment to our current line of classic and comfortable men's and women's footwear brands.

"In addition, this transaction is consistent with our strategic focus on acquiring brands that can strengthen our earnings and operating margins. As we seek to grow the top line, we have an opportunity to utilise our existing infrastructure to drive natural cost-saving synergies."

Royal Robbins chairman, Dan Costa, added: "This partnership is a 'win win' for our retailers and our consumers. Phoenix Footwear brings us tremendous resources that will enable us to build upon our heritage and extend the brand.

"Through this new relationship, we will expand our ability to offer innovative styling, distinctive fabrications and a broad choice of apparel at excellent price points.

"In addition, we anticipate strengthening and preserving our existing specialty retail distribution channel, which has been a fundamental building block for this brand."