Mergers and acquisitions appear to be picking up while credit is still relatively cheap.
But credit could soon cost a little more as the Federal Reserve and other central banks revise rates in an effort to keep inflation under control.
Lazard is marketing contemporary fashion brand Ganni on behalf of private equity owner L Catterton, according to a Reuters report. The Danish brand could be valued between 500 and 700 million dollars. Non-binding offers are due by July 25.
The LVMH-backed private equity firm took a majority stake in Ganni in December 2017. At the time, it described the It-girl label as “one of the fastest growing brands in the global space clothing” with a network of high-end retailers in 20 countries. L Catterton, who declined to comment, has used his connections to help the brand increase its international reach.
Collaborations have been part of Ganni’s recent success. He’s worked with Ahluwalia on recycled denim, Dr. Scholl’s on wooden sandals, New Balance on sneakers, Vegea on an animal leather alternative, and Levi’s on hemp-infused clothing. The brand is also responding to consumer interest in sustainability by signing up to use Infinna fiber and meeting some of its climate action, circularity and supply chain goals ahead of schedule.
Ganni was founded in 2000 by an art connoisseur and gallerist who was trying to design the perfect cashmere knit. In 2009, the husband and wife team of Creative Director Ditte Reffstrup and CEO Nicolaj Reffstrup ran and controlled the Copenhagen-based label.
Earlier this week, British fashion and homeware brand Cath Kidston was taken to market by private equity owner Baring Private Equity Asia, two years after the brand went bankrupt at the start of the pandemic of Covid-19.
Hilco Capital quickly stepped in to take over the brand for an undisclosed sum. The deal includes the brand’s London flagship in Piccadilly, as well as 95 dealerships and a wholesale business that operates in 10 countries.
Sales for the year ending March 2022 would be 29 million pounds ($35.3 million), including digital business. About a third of sales come from outside the company’s UK headquarters, which Baring helped build during his ownership. This is the part of the business that Hilco will likely want to expand because of its growth potential.
Frasers Group PLC is on a wave of acquisitions.
Earlier this month the company acquired bankrupt Missguided for 20 million pounds ($25.2 million), although it is getting some heat from customers and suppliers who are not not thrilled with the revival of the fast fashion online retailer. Now Frasers has acquired a 28.7% stake in Australian fashion market MySale plc. As a marketplace platform, the company connects global buyers and sellers to Australian and New Zealand e-commerce sites.
“The Group believes this creates an opportunity for a strategic partnership in which the Group’s end-of-line products can be cleared through an established customs clearance channel. This pipeline will be further enhanced by the benefits of counter-seasonality between the European and Australian climates,” Frasers said.
Ted Baker and Kohl’s TBD
The future of British fashion retailer Ted Baker and US department store chain Kohl’s is still up in the air.
Ted Baker is still weighing options after US brand management firm Authentic Brands Group opted out, and there has been speculation it may need to lower its expected price range to attract a new buyer.
Kohl’s could be in a similar position with its potential buyer, Franchise Group, owner of Vitamin Shoppe. The two signed a three-week exclusivity period to firm up the terms of the deal, which expired last weekend. Speculation in recent weeks has centered on Franchise angling to lower its initial $60 per share offer — a deal valued at $7.4 billion — to closer to $50. Kohl’s shares are trading between $35 and $36.
There has also been criticism of Franchise’s plans to sell Kohl’s real estate to help fund the deal. Indeed, a sale-leaseback of the real estate that houses Kohl’s stores would burden its balance sheet in the form of higher overhead costs resulting from rent payments. Retailers tend not to like leveraging their real estate because their physical asset may give them more options in an economic downturn.