Ilina Devadhar
There have been numerous mergers and acquisitions in the fashion industry. M&A transactions have their pros and cons, and it is essential that companies do a detailed study before getting into such a transaction with one another. The following are some of the most recent and notable mergers and acquisitions that have taken place in the fashion industry.
- Reebok acquired by Authentic Brands Group
Reebok is an American footwear and clothing manufacturing company that is particularly known for its sportswear and footwear. Reebok created the first spiked running shoe and is well-known for introducing its “pump” technology.
Authentic Brands Group is an American brand management company that has its headquarters in the city of New York. It is known for holding numerous apparel, sports and entertainment brands. It grants licenses of the brands that it owns to third parties and tries to promote the brand’s identity by various marketing efforts.
On March 1, 2022, Authentic Brands Group (ABG) acquired Reebok at an estimated price of USD 2.5 billion. The team has great potential and seems to be very promising for Reebok as ABG has already assembled a roster of star players from different countries and sports who will be crucial in the distribution of Reebok products and its brand identity. Moreover, ABG looks to maintain Reebok’s independent DNA and identity while expanding its market base.
Since the acquisition is still in its nascent stage, it will be interesting to see whether it can fulfil the estimated outcomes and deliver a stronger brand by synergy of the two companies.
- Hey Dude acquired by Crocs
Crocs is an American company based in Broomfield, Colorado. It is a manufacturer of footwear and has gained immense popularity due to their unique products. The shoe wear is extremely comfortable and customisable. Moreover, the resin used to make the shoes is a company secret which only they know how to make.
Hey Dude was originally founded in Italy as a company which would produce comfortable and accessible footwear. It gained popularity for their footwear being lightweight and extremely comfortable. The Hey Dude footwear kind of resembled Crocs shoes. Hey Dude shoes are made while keeping sustainability in mind. Crocs acquired Hey Dude by USD 2.05 billion in cash and over 2 million shares issued to the founder of Hey Dude, Alessandro Rosano.
Crocs announced the acquisition of Hey Dude with the closing effective from February 17, 2022. According to Crocs, the primary reason for the acquisition is that Hey Dude would have second high-growth, thereby making the Crocs portfolio highly profitable. This would also enable Crocs to increase their global presence. Part of the reason for this acquisition is also to cut down on competition as both work in the similar line of products.
- THE YES acquired by Pinterest
The Yes is an AI-powered shopping service website founded in 2018 by Julie Bornstein and Amit Aggarwal. It provides a personalized shopping feed on a daily basis in relation to brands and various styles. It learns the user’s shopping tendencies and style as the user browses across fashion platforms. It uses technology to better understand the customer’s needs and wants and the style of clothing/accessories they prefer.
Pinterest is a social media platform where images, GIFs and videos can be shared via pinboards. It is a popular platform to get ideas, find inspiration and new products. Currently, it is working to improve online shopping through its platform.
In the month of June, 2022, Pinterest completed the acquisition of The Yes. According to Pinterest, the acquisition would be a step forward to integrate technology and accelerate the vision of Pinterest as a new taste-driven shopping platform.
- Paima acquired by Chanel
Paima is a knitwear business based in the Marche region that originated in 1976 as a knitting factory. It was run by the Marabini family. Over time, Paima started to produce knitwear for third party businesses. Ranging from wool and cotton to cashmere, it set the benchmark for knitting in an area which was not much into knitting. Paima had many luxury brands as clients, Chanel, the French luxury fashion house, being one of them. In fact, Chanel was a client for over 25 years.
Chanel confirmed its acquisition of Paima in August, 2021. Chanel wants to spread its presence in Italy and this acquisition seems the perfect way forward. Chanel would also be able to facilitate the training of craftsmen and strengthen its own network of partners.
