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Saturday, May 18, 2024

CVC, HPS to Invest In Authentic Brands at $12.7B Valuation

  • Authentic Brands Group is postponing its IPO to 2023 or 2024.
  • It has agreed to a significant investment from two private equity firms.
Reebok/Design: Alex Brooks

Sports Illustrated owner Authentic Brands Group is postponing an IPO to raise capital from two private equity firms instead.

CVC Capital Partners and HPS Investment Partners are buying significant equity stakes in Authentic Brands at a valuation of $12.7 billion.

Authentic Brands owns apparel and equipment brands like Airwalk, Prince Sports, Tapout, and Volcom, as well as fashion brands including Nine West, Juicy Couture, Brooks Brothers, Aeropostale, and Barneys New York.

It will close its acquisition of Reebok in Q1 2022, bringing its total annual retail sales to $20 billion, according to the companies.

With $125 billion in assets under management, CVC has been aggressive in searching out sports investments.

  • In October, CVC and conglomerate RPSG paid a combined $1.7 billion for two new Indian Premier League teams.
  • In August, it reached an agreement with La Liga on a deal worth over $3 billion that would garner 11% of the league’s media revenue for 50 years.
  • It has also invested $508.5 million in Six Nations Rugby, $300 million in International Volleyball Federation, and $169 million in the United Rugby Championship.

HPS manages $75 billion in assets, focusing on strategies such as direct lending, real estate, energy and power, and small-to-mid-size European businesses.

A BlackRock fund will remain Authentic Brands’ largest shareholder, while existing shareholders, including Shaquille O’Neal, will retain large stakes. It will target an IPO in 2023 or 2024.

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