This year, mergers and acquisitions appeared to take a backseat amid the plethora of challenges borne of the coronavirus pandemic, including widespread disruption and uncertainty for businesses across all industries.
According to the Boston Consulting Group, deal volume in April was 80% lower than just four months prior in December. However, the advisory firm noted a resurgence in alliances in the June and August as financially sound companies established strategic partnerships, solidified joint ventures or bought out struggling chains from bankruptcy.
While renewed lockdowns pose a threat to recovery in the market, a number of playmakers have continued to flex their buying power. Here, FN spotlights the companies that scored deals in a challenged retail environment.
Authentic Brands Group LLC
Within less than a year, ABG — led by CEO Jamie Salter and president Nick Woodhouse — took over four major global brands as digital acceleration and the coronavirus pandemic left a trail of bankruptcies and upheaval across the retail sector. In partnership with Simon Property Group, it snapped up department store Barneys New York, fast-fashion giant Forever 21, denim purveyor Lucky Brand and menswear clothier Brooks Brothers — all of which sought Chapter 11 protection to save their businesses. Now, the brand management firm is said to be eyeing United Kingdom-based Debenhams and Topshop owner Arcadia Group.
Simon Property Group Inc.
It’s been a busy year for Simon, which has been embroiled in legal battles with some of its retail tenants — including multi-brand firm The Gap Inc. — over missed rent payments amid COVID-19 lockdowns. Still, the mall behemoth managed to expand its retail enterprise through its joint venture with ABG dubbed SPARC Group, as well as acquired substantially all of J. C. Penney Company Inc.’s business out bankruptcy along with Brookfield Property Partners. It has also moved forward with the Taubman Centers Inc. merger, which was arranged in February but hit a snag as the outbreak forced the closures of nonessential retail across the country.
Marc Fisher Footwear Corp.
The company — headed by founder Marc Fisher and president Susan Itzkowitz — inked a multi-year licensing agreement with Calvin Klein for the design, production and distribution of the namesake brand’s and its Calvin Klein Jeans’ shoe collections in the U.S. and Canada. The fashion footwear firm’s roster already includes heavy-hitters Guess, Tommy Hilfiger, Easy Spirit, Unisa, Sigerson Morrison, Bandolino and Nine West, along with namesake labels Marc Fisher and Marc Fisher Ltd.
Retail Ecommerce Ventures LLC
Fresh off of last year’s buyout of bankrupt Dressbarn’s intellectual property assets, CEO Alex Mehr and president Tai Lopez of Retail Ecommerce Ventures continued to sign more retail deals: The firm emerged as the winner to acquire Pier 1’s IP, data and e-commerce assets, as well as those of Modell’s Sporting Goods and RadioShack. This month, it purchased Stein Mart’s IP assets through a bankruptcy court auction and expects to re-launch the off-price retailer as an online-only store early next year.
In November, VF Corp. signed a definitive agreement to acquire New York-based Supreme in a reported $2.1 billion deal. According to the Denver-headquartered retail group, the cult-favorite brand offers a $1 billion global opportunity and complements the “street-inspired” labels in its portfolio, including Vans, The North Face, Timberland and Dickies. Investors cheered on the deal; a number of analysts pointed to the label’s marked success in using the scarcity model to drum up hype as well as leveraging its presence in the multibillion-dollar resale market.