In this week’s more fashion acquisition news, French luxury brand Chanel acquired the British men’s swimming brand Orlebar Brown, the amount of the acquisition was not disclosed. Although the terms of the deal were not disclosed, Chanel bought all the shares from company founder Adam Brown and private equity firm Piper. Brown will continue to serve as creative director of the company, which has grown into a mature lifestyle and vacation brand known for swimming trunks, polo shirts and T-shirts.
The move marks another effort by Chanel to acquire small fashion companies specializing in certain product categories. Chanel is also the owner of the high-end women’s beach and lingerie brand Eres, which looks to leverage synergies and distribution with Orlebar Brown. The notorious private Wertheimer family, the owner of Chanel, also invested in several other companies in the fashion and beauty sector through its family office Mousse Partners, including Ulta and Bonobos.
Although the acquisition of Orlebar Brown is another complement to the Chanel portfolio, there is no guess that Chanel is seeking to establish a group model that can compete with French counterparts LVMH and Kering, even the newly formed Capri Holdings, former Michael Kors Holdings. The difference is the size of the brands owned by these holding companies. Versace, which Michael Coles bought this week, earns about $800 million a year. Many of the other brands in the Kering and LVMH portfolios have significantly exceeded or contrasted with Orlebar Brown, which is estimated to produce approximately $32.6 million. Chanel graduates revealed this summer that it is a $10 billion business.
Therefore, the acquisition is very interesting because Chanel does not intend to buy a super brand or build a luxury fashion store. Orlebar Brown earns a lot of money through its e-commerce channel, and Chanel is largely away from this in terms of ready-to-wear and handbags, but instead chooses to sell in stores. This also marks Chanel’s first involvement in men’s wear, because the company mainly sells women’s products and cosmetics. A few weeks ago. Perhaps the acquisition of Brown into the male market will enable Chanel to consider more male products in the future. There is no doubt that Orlebar Brown will benefit from Chanel’s large infrastructure and will use its network to seek growth opportunities on a global scale.
As mentioned earlier, Chanel unveiled its financial data for the first time in its 108-year history this summer, in part to avoid rumors that it is an acquisition target or is looking for a sale. It also announced that its holding company, Chanel Limited, will be based in London to bring all of its operations together. Chanel’s chairman, Alan Wertheimer, and his brother Gerard, respectively, own half of Chanel.
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