Authentic Brands Group Acquires Vince IP

Authentic Brands Group, the licensing firm that owns Barneys and Brooks Brothers among other retail names, has acquired the intellectual property behind contemporary brand Vince, the two companies announced Tuesday.

Under the transaction agreement, a new ABG Vince entity has been created, of which ABG will own 75 percent while Vince Holding Corp. owns the rest.

Launched in 2002, Vince is known for straightforward basics at a contemporary price point. The company went public in 2013, but has struggled to operate in the black in recent years. In its most recent fiscal year, Vince posted a net loss of $38.3 million on $357 million in net sales, which were up 11 percent from fiscal 2021, the company reported Tuesday. In the fourth quarter of 2022, sales dipped 8 percent.

As of Tuesday, the company’s market capitalisation was $87.5 million. With ownership of 69 percent of Vince shares, Private equity firm Sun Capital Partners is Vince’s largest stakeholder, according to Bloomberg data from late last year.

As part of the deal, Vince has entered into a licensing agreement with the new ABG entity to operate its existing wholesale, retail and e-commerce business. As of early this year, Vince runs 50 full-price stores, 17 outlets and a wholesale network that accounts for just over half of its total revenue. ABG will maintain the brand’s current store footprint, it said in the announcement Tuesday, and will open new locations accordingly.

Vince owns Rebecca Taylor and Parker, which make up a small fraction of its sales. Last year, Vince announced it would wind down the Rebecca Taylor operation and sold its IP to real estate firm Ramani Group.

“We see significant opportunities to expand Vince’s offerings to meet the growing demand for premium and luxury goods around the world,” ABG founder and chief executive officer Jamie Salter said in a statement.

ABG will help expand Vince’s assortment in menswear, according to Vince CEO Jack Schwefel. The partnership will “provide us the necessary capital to strengthen our balance sheet allowing for opportunities to enhance our focus on driving margin expansion,” Schwefel added in a statement.

“We will also benefit from leveraging Authentic’s expertise and Lifestyle and Entertainment platforms, which provide opportunities to grow the Vince brand into adjacent categories and territories,” Schwefel added, referring to ABG’s portfolio of not only brands like Forever 21 and Herve Leger but also celebrity IP — including that of David Beckham and Shaquille O’Neal — and Sports Illustrated too.

The deal is expected to close in the second quarter of 2023. Vince will remain publicly traded. Its shares are down 7 percent following news of the deal and the brand’s fourth-quarter earnings report Tuesday.