American outdoor sportswear giant VF Corporation (hereinafter referred to as “VF”) announced on Monday that it will acquire New York street fashion brand Supreme for US$2.1 billion.
Supreme’s existing shareholders, private equity investment firms Carlyle Group and Goode Partners, will sell their stakes. Supreme brand founder James Jebbia and the existing senior management team will remain with the company. If Supreme reaches certain targets before the deal is completed, VF will increase the acquisition price to $2.4 billion.
This is VF’s largest acquisition since it acquired outdoor brand Timberland for US$2.3 billion in 2011.
In 1994, Supreme was formed from the United Kingdom James Jebbia, a skateboard enthusiast, was founded in New York, USA, and has gradually developed into a very popular street brand with extremely high profitability. In 2017, Carlyle Group acquired a 50% stake in Supreme for US$500 million. The transaction valued Supreme at US$1.1 billion, including US$1 billion in equity and US$100 million in debt.
As one of the world’s largest listed ready-to-wear companies, VF Group includes VANS, TheNorth Face, Timberland, Lee and many other brands, and the first three brands are frequent guests on Supreme’s cooperative brand list. “VF is the ideal home for Supreme. We will respect the brand’s heritage and culture while leveraging our scale and expertise to help them achieve long-term sustainable growth.” Steve Rendle, president and CEO of VF, said: “The Supreme brand will It will further accelerate our digital transformation and will also be an effective driver for us to create long-term value for shareholders.”
James Jebbia said: “We are proud to join a world-class company like VF, which owns There are a lot of great brands, some of which we have been working with for many years.”
Supreme was founded in 1994 by James Jebbia. It has become the fastest-growing fashion brand in the world, and its products are popular among fashion trends. Popular among people, the limited edition joint series sold out quickly as soon as it was released. Currently, Supreme has a total of 11 stores in Manhattan, Brooklyn, Los Angeles, London, Paris and Tokyo, and has also launched an e-commerce website. It has previously cooperated with VF Group’s outdoor brand TheNorthFace and skateboard apparel brand Vans on many occasions.
Above picture: Supreme and TheNorthFace’s joint series
VF expects Supreme to bring sales of more than US$500 million to the group in fiscal year 2022. In addition, VF also stated that after the acquisition is completed, Supreme will still be able to co-brand with brands other than the VF Group.
The transaction is expected to be completed by the end of 2020 and still requires regulatory approval.
After the news was announced, VF’s stock price rose 10.5% in pre-market trading. As of the close of trading last Friday, VF Group’s stock price had fallen by more than 30% in 2020. In the second quarter of fiscal year 2020/21, which ended on September 26, VF’s sales revenue fell 18% year-on-year to $2.6 billion, or 19% at constant exchange rates.
Everyone is happy for Supreme to be acquired by VF Group. The Carlyle Group successfully cashed out 1.05 billion U.S. dollars. Supreme’s principal also made a fortune, and Supreme will also benefit from VF’s acquisition. Blessing develops even more rapidly. For Supreme fans, it is still unknown whether this acquisition is good or bad, but what is certain is that there will be more and more joint brands between Supreme and VF Group. After all, they are already a family. Maybe we can see it in the future. VANS×TheNorthFace×Supreme×*** are co-branded in various ways. For VF Group, the acquisition of Supreme is of great significance to establishing its position in the trend field.
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