A growing number of M&A deals and investment rounds are bringing together some of the biggest names in the fashion and luxury space. In November, a $1.15 billion deal came to light, bringing together Cartier’s parent company Richemont, Chinese e-commerce titan Alibaba, and fashion retail platform Farfetch. The headline-making transaction followed from reports that a “mega deal” was in the making. In addition to proving noteworthy because it brought together three very big names in the fashion sphere in furtherance of an effort that largely focuses on “providing luxury brands with enhanced access to the China market,” the alliance is striking, as it has given rise to speculation about a potential consolidation, with at least some analysts wondering aloud whether the $1.15 billion tie-up could be “a preamble” a larger M&A effort, namely, Richemont merging Yoox Net-a-Porter with Farfetch or the Swiss conglomerate selling the fashion e-commerce pioneer to Alibaba.
Around the same time, LVMH Moët Hennessy Louis Vuitton decided to make good on an acquisition effort of its own, the one it had also been quietly (and then not so quietly) working towards: Tiffany & Co. Just a matter of days before the Farfetch-Alibaba-YNAP deal was confirmed, LVMH and Tiffany revealed that they had managed to put their rival lawsuits to bed and come to agreeable terms under which the famed New York-based jewelry stalwart could be brought under the ownership umbrella of the Paris-based luxury goods titan. In exchange for $15.8 billion, LVMH would acquire all shares in the formerly publicly-traded Tiffany & Co.
Both instances come as consolidation has been top of mind in the luxury space, where the biggest groups, such as Louis Vuitton-owner LVMH and Gucci’s parent company Kering, have amassed sizable rosters of brands over the past several decades by way of various fashion and luxury-centric M&A transactions, thereby, enabling them to benefit from sheer size and scale, while making it more difficult for independently-owned brands to compete. The havoc wreaked on brands’ balance sheets by the COVID-19 pandemic and the resulting shift online (and the expenses that come with doing that and doing it well) is expected to accelerate that existing fashion industry M&A activity even further.
“With the financial difficulties [brought about by COVID] in mind, many players, and in particular the smallest, will become more-affordable M&A targets,” according to Isabelle Chaboud, an Associate Professor in the Finance, Accounting and Law Department of Grenoble Ecole de Management. “The most financially solid players – such as LVMH, Kering or Chanel – will no doubt have the option of buying out competitors, subcontractors and even suppliers.” (For a timeline of supplier-specific M&A, you can find that here.)
A Timeline of Transactions
With the foregoing in mind, here is a running timeline of the most recent fashion and luxury-focused M&A and investments dating back to LVMH’s headline-making deal with Tiffany & Co. …
May 17, 2023 – Shein Raises $2 Billion in New Round
Shein raised $2 billion in a recently-closed funding round that values the Chinese fast fashion giant at $66 billion co-led by Sequoia Capital, General Atlantic and the U.A.E. sovereign-wealth fund Mubadala. The valuation is about a third less than the $100 billion valuation the company boasted in April 2022 following a round that saw it raise between $1 billion and $2 billion. (General Atlantic participated in the previous round, along with existing investors Tiger Global Management and Sequoia Capital China.) “Investors in the last round were allotted more shares in the company to maintain the size of their stakes,” the WSJ reported, noting that some existing investors revealed that the lower valuation “leaves headroom for the company to boost its market value should an IPO come to fruition.”
May 15, 2023 – Frasers Boosts Stake in ASOS
British retail entity Frasers Group has boosted its stake in ASOS to 7.4 percent up from its previously holding of more than 5 percent. The increase in stake for Frasers “comes a week after ASOS swung to a first-half loss, hit by a squeeze on household budgets and forecast a further drop in sales,” per Reuters.
May 11, 2023 – Marks & Spencer Injects New Cash into Nobody’s Child
Marks & Spencer has injected new cash into Nobody’s Child, the London-based eco-conscious fashion brand in which it previously invested in. While the terms of the deal have not been disclosed, Richard Price, managing director of clothing and home at M&S, which previously maintained a 27 percent stake in the brand, stated: “As an important part of the M&S family, we’re delighted to be able to support the brand with additional funding to unlock even more potential as they continue to grow.”
Nobody’s Child – which counts M&S as a retail partner – will use the new funds to meet the increased demand from customers this season, and expand into markets, including the U.S., Europe, and the United Arab Emirates.
May 3, 2023 – Secret Sales Raises $10M in Series B
Secret Sales has raised $10 million dollars in a Series B round that includes ePerwyn, Belerion Capital, and Big Ideas Group. The London-based outlet marketplace, which enables brands to offload surplus garments and accessories, will use the new funds to accelerate expansion in Europe, with 12 new markets, in furtherance of its aim to be “the go-to destination for non-full price retail in all main European markets” by 2025. CEO Chris Griffin said in statement that as of February 2023, the company boasted an inventory of 25 million items with a combined value of £3 billion – an increase of 125 percent year-on-year. The round follows from a $10 million Series A in June 2021.
May 3, 2023 – Francesca’s Acquires Richer Poorer
Francesca’s Acquisition LLC announced the asset purchase of California-based wardrobe essentials brand, Richer Poorer. This integration will put Richer Poorer under the francesca’s Acquisition LLC umbrella as a wholly owned subsidiary. The terms of the deal have not been disclosed. In a statement in connection with the acquisition, Francesca’s – which filed for Chapter 11 bankruptcy protection in 2020 and was acquired by TerraMar Capital LLC – asserted, “Two years into a multi-year enterprise growth strategy after being taken private in 2021 by TerraMar Capital LLC, francesca’s has continued to prioritize growing its eCommerce channel and customer experience, scaling tween brand franki by francesca’s, expanding physical boutique experiences, as well as most recently launching the fran Club loyalty platform and forever fran, a re-sale partnership with thredUP.”
Apr. 24, 2023 – Authentic Brands to Acquire Stake in Vince IP in $75 Million-Plus Deal
Vince Holding Corp. has entered into a strategic partnership with Authentic Brands Group, whereby Vince will contribute its intellectual property to the parties new venture, ABG Vince, for a total consideration of $76.5 million in cash and a 25 percent membership interest in ABG Vince. Through the agreement, Authentic will own the majority stake of 75 percent membership interest in ABG Vince. In connection with the deal, Vince says it will enter into “an exclusive, long-term license agreement with Authentic to use the contributed intellectual property for Vince’s existing business in a manner consistent with the company’s current wholesale, retail and e-commerce operations, and will pay a royalty fee to ABG Vince.”
Vince says it will use the proceeds from the new partnership to “strengthen its overall liquidity position, increase its working capital, and repay in full the outstanding balance of $27.7 million under its Term Loan Credit Facility, and to repay a portion of the outstanding borrowings under its Revolving Credit Facility.”
Apr. 21, 2023 – Walmart Offloads Eloquii to FullBeauty Brands
Walmart will sell plus size fashion brand Eloquii to FullBeauty Brands, the companies have confirmed. The terms of the deal have not been disclosed. Walmart acquired Eloquii in 2018 for a reported $100 million in furtherance of a “push to appeal to younger shoppers through a range of online brands and better position itself against e-commerce giant Amazon,” per Reuters.
Apr. 18, 2023 – THE LINK Raises $1M in Seed Round
THE LNK has closed a $1 million seed round led by Reetu Gupta and Suraj Gupta with participation from Manny Bahia and Mona Patel. Founded by Sonya Gill in 2022, Toronto-based THE LNK is a smart marketplace, online aggregator, and lead generation platform and “the first global affordable luxury marketplace to exclusively represent ethnically diverse indie brands. The company – which says that it employs “powerful marketing and AI tools to recommend relevant, high-quality, hidden gems from around the world to customers based on profile and shopping habits” – will use the new cash to “further web development, expanding their team, and continuing to redefine eCommerce for unique indie brands around the world.”
Apr. 13, 2023 – Express and WHP to Acquire Bonobos from Walmart for $75M
Express, Inc. and global brand management firm, WHP Global have reached a definitive agreement to acquire menswear brand Bonobos from Walmart Inc. for a combined purchase price of $75 million, in what is the first acquisition to be made jointly by WHP Global and Express since finalizing their strategic partnership earlier this year. In a statement, the Express and WHP said the acquisition of the menswear company will provide “strategic and financial benefits,” including: (1) the opportunity to unlock additional growth for the Bonobos brand; (2) expand the EXPR brand portfolio to accelerate growth and profitability (Bonobos will be the third brand in the EXPR portfolio, joining Express and UpWest); and (3) achieve synergies and efficiencies through EXPR fully integrated omni-channel operating platform.
WHP will acquire the Bonobos brand for a purchase price of $50 million. EXPR will acquire the operating assets and assume the related liabilities of the Bonobos business for a purchase price of $25 million. Concurrent with the closing of the transaction, WHP Global and EXPR will enter into an exclusive long-term license agreement with multiple renewal options granting EXPR the right to use the intellectual property acquired by WHP for the operation of the Bonobos business in the U.S. in exchange for EXPR’s payment of a royalty fee to WHP.
Apr. 11, 2023 – ChimHaeres Acquired Vionnet in First Fashion Deal
ChimHaeres Investment Holding – a newly formed joint venture between private investment firm Chimera Abu Dhabi and private equity investment company Haeres Capital – has acquired Vionnet in its first fashion industry deal, the terms of which were not disclosed. Additionally, the UAB-based firm has taken majority stakes in automaker Zagato and in Fogal, the Swiss hosiery brand. And still yet, ChimHaeres revealed that Haeres will fold its majority stake in Italian hat manufacturer Borsalino into the new vehicle.
ChimHaeres will target “legacy” and “next gen” brands with “favourable growth profiles” to serve a younger and increasingly more global consumer base, according to Mirian Khalaf, head of private equity at Chimera Abu Dhabi. The JV’s initial focus is on companies Italy, France, Switzerland, and the United Kingdom. Building on its initial investments, ChimHaeres is “on the lookout for investments in strong aspirational brands,” the firm said in a statement.
Apr. 6, 2023 – Biem.L.Fdlkk Garment Acquires Cerruti 1881 and Kent & Curwen
Biem.L.Fdlkk Garment has acquired the global trademarks rights for Cerruti 1881 and British menswear brand Kent & Curwen from Hong Kong-headquartered Trinity Ltd. for a combined $62.18 million. (The breakdown: Guangzhou, China-based Biem.L.Fdlkk Garment paid $62.18 million for Cerruti 1881, and $41.45 million for Kent & Curwen.) Publicly traded Biem.L.Fdlkk Garment is best known for golf apparel business and its retail properties in malls and airports in China.
Mar. 31, 2023 – Authentic Brands Group to Acquire Boardriders
Authentic Brands Group has made a binding offer to purchase Boardriders, a global action sports and lifestyle company, from funds managed by Oaktree Capital Management, L.P. The deal will see Authentic “strategically diversify and expand its portfolio with the addition of the most iconic brands in board sports, including Quiksilver, Billabong, Roxy, DC Shoes, RVCA, Element, VonZipper, and Honolua,” the company confirmed. The terms of the deal have not been disclosed but the parties revealed that the Boardriders portfolio generates $2.9 billion in retail sales annually through a global multichannel distribution network of 500-plus owned retail stores, 7,000 wholesale accounts and e-commerce in 35 countries. The acquisition is expected to be finalized in Q3 2023.
Mar. 28, 2023 – Next to Acquire Cath Kidston for $10.5M
British clothing chain Next Plc has agreed to buy fellow fashion brand Cath Kidston, which was recently placed into administration. Next will pay £8.5 million ($10.5 million) for the brand’s trademarks, domain names, and other intellectual property of Cath Kidston. Given that Next is not acquiring any of Cath Kidston’s inventory, it will license the domain name back to the administrators for “up to 12 weeks to clear stock before a re-launch under Next’s ownership,” per Reuters.
This is a short (and incomplete) excerpt from a data set that is published exclusively for TFL Enterprise subscribers. For access to our up-to-date fashion investment and M&A tracker, inquire today about how to sign up for an Enterprise subscription.