Count Vince as the latest fashion brand to come into the orbit of Authentic Brands Group.
In what was dubbed “a transformative strategic partnership,” Vince Holding Group plans to transfer its intellectual property to a newly formed Authentic subsidiary, ABG Vince, in return for $76.5 million in cash and a 25 percent membership interest in the subsidiary.
Vince will continue as a publicly traded company and plans to use proceeds from the deal to increase its working capital and repay the $27.7 million outstanding under its term loan credit facility.
Related Stories
Along with the partnership, the two signed a 10-year license that will allow Vince to continue running its current operations with the option for eight 10-year renewals.
Jack Schwefel, CEO of Vince, said the partnership “will provide us the necessary capital to strengthen our balance sheet allowing for opportunities to enhance our focus on driving margin expansion, and focusing on our strategic growth initiatives.”
These initiatives include making full use of the company’s e-commerce capabilities, expanding its international presence, growing the men’s business and opening stores in the U.S.
Jamie Salter, founder, chairman and CEO of Authentic, said: “We are excited to partner with Jack and the VNCE management team as we expect to mutually benefit from the strength of the Vince brand that has been developed over the past 20 years. The addition of another luxury brand to our formidable portfolio is timely as we see demand for luxury goods growing in key markets around the world.”
The deal is expected to close in the second quarter of this year.
