Express, Inc., WHP Global to buy Bonobos menswear brand from Walmart
Express, Inc. (EXPR) an American fashion apparel retailer alongside brand management firm WHP Global has agreed to acquire the Bonobos menswear brand from Walmart for $75 million.
WHP Global will acquire the Bonobos brand for a sum of $50 million, while EXPRESS, INC. will acquire the operational assets and take on the related liabilities of the menswear brand business for $25 million.
In conjunction with the conclusion of the transaction, WHP Global and EXPRESS, INC. will forge an exclusive long-term license agreement that includes several renewal options that grant the latter the possibility of using the intellectual property that was acquired through the brand management firm for the operation of the Bonobos business in the US. This will be in exchange for a royalty fee payment by EXPRESS, INC. to WHP Global.
Bonobos marks the first acquisition to be jointly executed by WHP Global and EXPRESS, INC. since the formalization of their strategic partnership earlier in the year.
The menswear brand was launched online in 2007 with its signature range of better-fitting men’s pants and in mid-2017 was bought by Walmart for $310 million in cash.
Express, Inc., WHP Global to acquire Bonobos menswear brand from Walmart for $75m
In 2011, Bonobos moved its business into the offline segment as well by opening the Bonobos Guideshops, e-commerce stores that offer customized, individual service to men wanting to experience the clothing brand in person.
John Hutchison — Bonobos CEO said: “This is an exciting moment for Bonobos as we embark on the next phase of our growth. Born a digitally native vertical brand, we plan to build on our strength in eCommerce and customer loyalty, leverage EXPR’s expertise in omnichannel retailing and scale through WHP Global’s partnerships in licensing and distribution.”
EXPRESS, INC. said that it plans to make use of its strength in the male market to tackle under-served categories and also its capabilities in marketing to increase awareness and acquisition of customers.
Bonobos is the third brand within the EXPRESS, INC. portfolio that will be joining Express as well as UpWest.
EXPRESS, INC. said that the menswear brand is anticipated to add to operating earnings and cash flow positive in the 2023 fiscal year, which will accelerate the growth of its sales and increase profitability.
The American fashion apparel retailer plans to use its platform to create efficiency in operations, financial synergies, and other economics of scale in production and sourcing, real estate, logistics, technology, and many other aspects of its new and existing business.
Tim Baxter — Express, Inc. CEO said: “Our strategic roadmap to transform EXPR to create shareholder value includes achieving profitable growth in our core Express business – which is our first priority – optimizing our omnichannel platform, and accelerating our growth and profitability through our partnership with WHP Global.
“Bonobos is delivering double-digit sales growth and we plan to continue that momentum while also realizing operating synergies and other economies of scale. This is a compelling addition to our brand portfolio, and I expect the transaction will be accretive to operating income and free cash flow positive in fiscal 2023.”
The deal is expected to be completed in the second quarter of fiscal 2023 of EXPRESS, INC. and is subject to the meeting of customary closing conditions.