May 19 - Shoemaker Deckers Outdoor Corp agreed to acquire privately-held sports shoe brand Sanuk for $120 million in cash as it looks to tap the brand's customer base in the action sports footwear market.

UGG Australia (Deckers Outdoor Corp)

Goleta, California-based Deckers, known for its sheepskin UGG boots, expects the deal for Sanuk to be modestly accretive to earnings for 2011.

The deal includes additional participation payments based upon performance of the brand over the next five years.

Sanuk was founded in 1997 by Jeff Kelley. The brand's first product was a sandal made of green indoor-outdoor carpet and is known for its sandals and sports shoes.

(Reporting by Viraj Nair in Bangalore;Editing by Prem Udayabhanu)