Authentic Brands’ IPO Delay Won’t Slow Evolution of Retail Marketplace Aggregators

Same stable, more horses.

That’s the reality behind Authentic Brands Group (ABG) and its surprise announcement on Monday (Nov. 22) that it had secured all the new funding it needed and was therefore punting its planned IPO down the road three or four years.

We are pleased to announce that the world-leading private equity and investment firms #CVCCapital and #HPSInvestmentPartners are coming on board as significant shareholders and joining our current stable of equity partners. Learn more here https://t.co/Vih39fEw5l.

— Authentic Brands Group (@AuthenticBrands) November 22, 2021

By adding the deep-pocketed clout of CVC Capital and HPS Investment Partners to its existing roster of retail, real estate and asset management heavyweights, ABG will be able to keep right on doing exactly what it has been doing as a private company for the past decade — which is bundling up bruised brands and bringing them in-house, polishing them up and then re-launching them alongside dozens of other names now under its control in an omnichannel potpourri.

At last count, ABG had amassed a bundled retail marketplace (more commonly referred to as its global portfolio) that had grown to 44 different labels spanning “media, entertainment, luxe, fashion, street, wellness, home, active and outdoor lifestyle sectors,” according to the company’s website.

“We’re free to do whatever we want. We just made a deal for Iconic Images last week and Reebok closes on Feb. 28. And we expect to make a significant acquisition before the end of the year,” ABG Founder and CEO Jamie Salter said in an exclusive interview granted to WWD, which also served as a de-facto press release. “We [had] pursued an IPO so that we could bring value to ABG and its shareholders. We are achieving exactly that with the onboarding of new equity partners,” Salter added in light of the firm’s new $12.7 billion valuation.

Smart Money Eats First

ABG’s ability to retain and attract some of the world’s largest, most savvy investors to its cause is clearly an endorsement that its bundled retail marketplace concept has legs. According to the company’s messaging in the WWD article, the two new investors will join a star-studded stable that consists of “BlackRock, Simon Property Group, General Atlantic, Leonard Green & Partners, GIC Private Ltd., Brookfield Property Partners, Lion Capital, Jasper Ridge Partners as well as Shaquille O’Neal.”

While individual investors will not be able to get a piece of the action for a few more years, the institutions are in and set to make a killing on a basket of brands that includes Aeropostale, IZOD and Brooks Brothers, as well as the estates of Marilyn Monroe and Muhammed Ali.

While ABG’s growing portfolio is unique, it is far from alone in its pursuit of this omnichannel bundling strategy, as it competes against dozens of Amazon aggregators that are actively looking to roll-up and scale thousands of small to medium-sized eCommerce brands that have sprouted up over the past decade.

Also see: Mumbai eCommerce Aggregator Evenflow Acquires Third Brand in Three Weeks

And: German eCommerce Incubator Berlin Brands Aims to Scale US Amazon Sellers in Europe

Where ABG’s model is unique, however, is that its department store-like collection of brands consists of a much-coveted combination of revamped digital properties, which also include several thousand physical locations to serve consumers’ shifting needs while meeting the demand for relevant and convenient retail.

This bundled marketplace trend has not only expanded beyond fashion, apparel and accessories to include other categories like furniture, packaged goods, electronics and more, but it is also set for additional growth, having caught the eye — and financial endorsement — of some of the retail industry’s leading minds.

“The investments from CVC Capital and HPS Investment Partners are a strong vote of confidence in ABG’s long-term vision and strategic approach,” ABG’s President and CMO Nick Woodhouse told WWD, while reiterating the company’s intention to further its more-of-the-same approach to acquiring companies and growing its stable of bundled brands.