Reebok owner Authentic Brands agrees $254 million deal for Ted Baker

A branch of Ted Baker stands on Regent Street in London, England.

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Authentic Brands Group, the retail conglomerate that owns brands such as Reebok, Forever 21 and Juicy Couture, made an agreement to buy British fashion chain Ted Baker for around 211 million pounds, or $254 million.

The trade price represents a premium of about 18% to Ted Baker’s closing price on Monday. The company is listed on the London Stock Exchange.

Ted Baker said his board will unanimously recommend that shareholders vote for the deal.

After completion, ABG declared its intention to separate the Ted Baker business into an intellectual property holding company which would remain controlled by ABG, plus one or more operating companies which would manage the stores, e-commerce operations and the brand’s wholesale business.

ABG also said it would explore options to transfer full or partial ownership and control of some or all of these separate operating companies to other partners.

Tuesday’s announcement ends months of speculation over the future of the British fashion moniker, which was forced to go on sale earlier this year amid pandemic difficulties.

Ted Baker rejected several offers from private equity chain Sycamore Partners before launching his own sale process. ABG had also at one point held talks with Ted Baker about a deal before walking away.

ABG CEO and Founder Jamie Falter said in a press release released on Tuesday that the Ted Baker brand is “highly valued” by consumers around the world.

“We are excited to build on the brand’s global foundation through a business model focused on licensing, wholesale, retail, digital and strategic marketing partnerships,” he said.

Ted Baker is also in the midst of his own recovery plans and hopes to benefit from the continued strength in luxury spending, even as inflation persists and consumers have cut spending on other non-discretionary items.

The strength of luxury retail has prompted more M&A activity in this sector, while UK businesses have become more affordable to overseas buyers due to the weaker pound.

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