Aritzia is accelerating its product expansion strategy into menswear through a definitive agreement to acquire Reigning Champ. Aritzia will acquire 75 percent of the premium athletic wear brand based on a total enterprise value of approximately $63 million, with the remaining 25 percent equity interest purchased through 2026.
Reigning Champ is expected to deliver approximately $25 million in revenue and $5 million in adjusted EBITDA in calendar 2021. The acquisition is expected to be completed in June 2021, subject to customary closing conditions and approvals. Aritzia will fund the initial purchase with cash on hand.
“We’re excited to welcome Reigning Champ. Rooted in classic, timeless athletic wear, their brand has been carefully curated for just short of fifteen years,” said Brian Hill, founder, chief executive officer, and chairman of Aritzia. “Building on Aritzia’s strong start to fiscal 2022, this acquisition meaningfully accelerates our product expansion into men’s while bringing incremental growth to our already surging women’s eCommerce and U.S. businesses. Capitalizing on our world-class operational expertise and infrastructure, men’s merchandised independently will become a meaningful part of Aritzia’s platform through our Reigning Champ acquisition.”
“As an innovative design house offering exceptional experiences through its online and retail platforms, Aritzia’s well-established track record as a successful direct-to-consumer business is one that we’ve long admired,” added Craig Atkinson, co-founder and chief executive officer of Reigning Champ. “Leveraging Aritzia’s unparalleled world-class infrastructure and expertise, this partnership provides an exciting path forward to elevate Reigning Champ to the next level as a premium athletic wear brand. We look forward to working with the incredibly talented Aritzia team to capitalize on the limitless opportunities ahead.”
Atkinson is joined on Reigning Champ’s senior leadership team by co-founder and vice president of manufacturing Chris Nordee and chief financial officer Paul Heathcote – all with a long history in the apparel industry. They will continue operating the business in partnership with Aritzia through a transition period of approximately five years to allow both businesses to focus on sustaining their unique brands and cultures while leveraging mutually beneficial synergies and efficiencies to an accelerated path forward.