The company behind Forever 21 and Brooks Brothers is delaying IPO plans and selling stakes to private equity firms
- Authentic Brands Group will sell equity stakes valuing the retail management company at $1.27 billion.
- ABG's founder and CEO Jamie Salter reportedly said the company will pursue an IPO in 2023 or 2024.
Authentic Brands Group, which is set to acquire Reebok next year, has set aside plans to go public and will sell equity stakes in deals valuing the retail management firm at more than $12 billion.
ABG said Monday funds advised by CVC Capital Partners and HPS Investment Partners will purchase "significant" equity stakes from some of its shareholders, putting a $12.7 enterprise value on the company that licenses and develops more than 30 lifestyle and entertainment brands.
Investors have been anticipating ABG would go public following its July filing with the Securities and Exchange Commission plans for an initial public offering, a move that would list the company that generated about $10 billion in annual gross merchandise value worldwide in 2020.
ABG's CEO Jamie Salter told fashion industry trade publication WWD that the company will pursue an IPO in 2023 or 2024.
"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 of ABG, in the statement. "We are primed to continue furthering our global presence, acquiring new entertainment and lifestyle brands and driving organic growth for our portfolio."
The company will raise $3.5 billion through the stake sales, with the largest portion coming from CVC, The Wall Street Journal reported, citing people familiar with the matter.
ABG took Brooks Brothers out of bankruptcy last year and in 2022 plans to add Reebook to its stable of fashion, entertainment, home, arts, and media brands. The company, which was founded by Salter in 2010, counts Forever 21, Aeropostale, and Lucky Brand among its lifestyle companies, and Sports Illustrated and former NBA star Shaquille O'Neal as part of its entertainment portfolio.
BlackRock Long Term Private Capital will remain as ABG's largest shareholder.