by Will sell equity stakes to PE firms instead
NEW YORK – Authentic Brands Group, a brand development, marketing and entertainment company that owns the Thomasville Furniture brand, recently has ended its planned IPO first announced in July and has agreed to have some of its equity stakes sold instead to private entities.
The company said that funds advised by CVC Capital Partners and HPS Investment Partners have signed definitive agreements to acquire “significant equity stakes” in the company from certain current shareholders. ABG said this transaction values the company at $12.7 billion in enterprise value.
Authentic Brands Group acquired Thomasville in late 2018 as part of a bankruptcy proceeding. In addition to Thomasville, ABG acquired the Broyhill brand, which it in turn sold to Big Lots, which also occurred in late 2018.
Along with Thomasville, ABG owns more than 30 brands in the sports, fashion, outdoor, home, entertainment and fine arts sectors. The company said that with the acquisition of Reebok set to close in the first quarter of 2022, its portfolio will be valued at more than $20 billion in “annual system-wide retail sales and global distribution” in more than 150 countries.
ABG founder, Chairman and CEO Jamie Salter said that ABG has known CVC and HPS for many years and that the company is pleased they are becoming significant stakeholders.
“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,” he said. “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.”
The transaction is set to close in December. At that point, CVC and HPS will join ABG’s Board of Directors.
“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. “We are primed to continue furthering our global presence, acquiring new entertainment and lifestyle brands and driving organic growth for our portfolio.”
Officials at CVC said they were pleased at the opportunity to partner with ABC to help execute its vision moving forward.
“ABG has shown that its unique business model can successfully innovate and grow brands across a broad spectrum of consumer categories, and we are excited to leverage CVC’s experience in the consumer, retail and media and entertainment sectors to support the company’s growth ambitions,” said Chris Baldwin, a managing partner at CVC. “We plan to work closely with the ABG team to execute on their strategic priorities, particularly around international expansion, given our extensive global footprint and experience in local markets around the world.”
“We have followed ABG’s success story for several years and are delighted to be partnering with the company and its investor group,” added Chris Stadler, a managing partner at CVC. “The power of the ABG platform is evident in its growth to date, and we believe the company is only beginning to realize the full benefit of its scale and diversification. We look forward to working with Jamie, Nick and the talented team at ABG to create even greater value together.”
Scot French, a governing partner at HPS, said that the company also is pleased to partner with Salter and “his outstanding team, who we have known for nearly a decade, to support ABG’s ongoing development and growth strategy as it continues to lead the market in the brand licensing arena, underpinned by a highly differentiated and innovative acquisition and brand management platform.”
BlackRock Long Term Private Capital will remain the company’s largest shareholder, a position it has held since 2019. In addition, Simon, General Atlantic, Leonard Green & Partners, GIC, Brookfield, Lion Capital, Jasper Ridge Partners and Shaquille O’Neal also will continue to hold significant equity positions, the company said.
