Authentic Brands Group acquires Champion
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Authentic Brands Group (Authentic), which counts Reebok, Ted Baker and Quiksilver among its brand portfolio, has confirmed it's acquiring the Champion Athleticwear brand and business from HanesBrands for 1.2 million US dollars.
The strategic move will see the global brand development, marketing and entertainment platform expand its position in sports, lifestyle, entertainment and media brands and increase its system-wide annual retail sales to more than 32 billion US dollars worldwide.
Jamie Salter, chairman and chief executive officer of Authentic, said in a statement: "We are excited to acquire Champion, a brand that shares our pioneering spirit. Over the last few years, the addition of new brands together with the expansion of live events has grown Authentic into a world leading sports and entertainment licensing company. Bringing Champion into the fold further expands our position in this space.”
Champion Athleticwear to become part of Authentic portfolio
Sportswear brand Champion has played a pivotal role in shaping athletic wear, notably introducing the first hooded sweatshirt. It has become known for its fusing heritage designs with innovative materials and offers a full line of athletic apparel for men and women, including activewear, sweats, T-shirts, sports bras, team uniforms, footwear and accessories.
The brand currently operates in more than 90 countries, with more than 40 percent of its business hailing from outside North America.
Authentic said it will utilise the same approach with Champion as with Reebok, which it acquired in 2022, by leveraging its diverse and multifaceted platform of consumer vertical, as well as its expertise with brand-building to convert the Champion business into a licensed model.
The company added that it is in discussions with several existing and potential operators in key regions to manage the manufacturing, physical retail, e-commerce and wholesale operations of the business and maintain the brand’s global footprint.
Nick Woodhouse, president and chief brand officer of Authentic, added: "Our successful efforts igniting Reebok's momentum in sports have created a playbook to achieve a similar feat with Champion.
“With expansive reach, differentiated channel strategy and a balanced strength across its women’s and men’s businesses, Champion has profoundly influenced sports culture. This is the perfect time for the brand to make a significant impact as Women's sports continue to broaden their presence and fandom worldwide.”
The acquisition of Champion is subject to certain standard closing conditions, including regulatory approval, and is expected to be finalised in the second half of 2024.
HanesBrands to focus on global innerwear business
HanesBrands added in its own statement that the transaction was valued at 1.2 billion US dollars with potential to achieve 1.5 billion US dollars based on contingent cash consideration of up to 300 million US dollars.
The move to offload Champion is due to the company’s renewed focus on its innerwear business, which includes Hanes, Bonds, Maidenform, and Bali, which has seen an increase in market share.
Upon completion of the transaction, HanesBrands said it intends to focus on extending its leadership position in the innerwear category and generating above-market growth through continued consumer-centric product innovation and increasing investment across its portfolio of leading brands.
Steve Bratspies, chief executive at HanesBrands, said: “Today’s announcement is the culmination of significant effort by our teams to position all of our brands on the optimal path for the future. Over the past three years, we have taken necessary actions to enhance the company’s operations and financial performance – returning to historical gross margins, reducing our cost structure, lowering our debt levels, and generating consistent cash flow.
“The successful completion of this transaction further simplifies our business, deleverages our balance sheet and enhances the company’s operations and financial performance. As we begin the next chapter for HanesBrands, we believe we’re in an even stronger position to further extend our leadership in innerwear, pursue new cost reduction opportunities as we ensure we have the right operating structure in place, and advance our multi-year flywheel to drive strong shareholder returns.”