AUTHENTIC BRANDS GETS NEW INVESTORS, CALLS OFF IPO

by Christopher Blomquist

Conglomerate Authentic Brands Group (ABG), whose constantly growing stable of more than 30 fashion, luxury, outdoor, home, entertainment, events, media and fine arts brands that include everything from Van Heusen (pictured above) and Nautica to Sports Illustrated magazine and Barneys New York, has cancelled its plans for an IPO (announced in July) and has instead added two new investors, thereby staying private – at least for the next few years.

The company announced yesterday that CVC Capital Partners (CVC) and HPS Investment Partners (HPS) have signed definitive agreements to purchase significant equity stakes in ABG. The transaction values the company at $12.7 billion in enterprise value.

Jamie Salter

“We have known CVC and HPS for many years and are thrilled that they are coming on board as significant stakeholders in ABG. Their commitment is a testament to the exceptional work our team has put forth as well as CVC and HPS’s confidence in our future growth,” said Jamie Salter, Founder, Chairman and CEO of ABG, in an official statement. “The entire ABG team – from our leadership to the director of first impressions – has done an incredible job of building a sustainable and scalable business with a laser focus on brand development, digital innovation, e-commerce, specialty retail, expansion into new verticals and proven business models.”

He later told CNBC that he is now aiming for an IPO in 2023 or 2024 and that he has re-upped as CEO for five more years.

Since being founded in 2010, ABG has grown substanstainally and made headlines with notable brand acquisitions including Barneys New York in November 2019, Brooks Brothers in September 2020, PVH’s Heritage Brands – Izod, Arrow, Van Heusen and Geoffrey Beene – this past summer and most recently, Reebok (from Adidas), the transfer of which is set to be finalized in Q1 of 2022. Once completed, it will bring ABG’s portfolio to more than $20 billion in annual system-wide retail sales with global distribution in more than 150 countries.

Nick Woodhouse

“The investments from CVC Capital and HPS Investment Partners are a strong vote of confidence in ABG’s long-term vision and strategic approach,” said Nick Woodhouse, President and CMO of ABG, in a company statement. “We are primed to continue furthering our global presence, acquiring new entertainment and lifestyle brands and driving organic growth for our portfolio.”

BlackRock Long Term Private Capital will retain its position as ABG’s largest shareholder, which it has held since 2019. Simon, General Atlantic, Leonard Green & Partners, GIC, Brookfield, Lion Capital, Jasper Ridge Partners and Shaquille O’Neal will continue to hold significant equity positions in the company.

The transaction is expected to close next month. At that point CVC and HPS will join ABG’s Board of Directors.

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