Bonobos is getting a new owner —again.
Express, Inc. (EXPR) and brand management firm WHP Global have entered into an agreement with Walmart to acquire direct-to-consumer menswear retailer for a combined $75 million. The price is a significant drop from the $310 million in cash that Walmart paid to buy Bonobos in 2017.
Founded online in 2007, Bonobos started out by selling men's pants, building a strong following with a focus on product fit and customer experience. It went on to expand its assortment to include a wider variety of men’s clothing.
The company also entered brick-and-mortar, opening stores — “guideshops” — that act as showroooms where customers can get expert advice and try on and buy merchandise, with the goods delivered to them afterwards. According to its website, Bonobos currently operates 60 shops nationwide.
Under the terms of the deal, WHP will acquire the Bonobos brand for a purchase price of $50 million. EXPR will acquire the operating assets and assume the related liabilities of the Bonobos business for a purchase price of $25 million. It is the first acquisition to be made jointly by the two companies since they completed their strategic partnership earlier this year, which included WHP buying a 60% stake in the Express brand.
“Bonobos is delivering double-digit sales growth and we plan to continue that momentum while also realizing operating synergies and other economies of scale. said Tim Baxter, CEO, EXPR. “This is a compelling addition to our brand portfolio, and I expect the transaction will be accretive to operating income and free cash flow positive in fiscal 2023.”
After the transaction closes, Bonobos CEO John Hutchison will become brand president of Bonobos and report to Baxter. Bonobos will remain at its current headquarters in New York.
“This is an exciting moment for Bonobos as we embark on the next phase of our growth,” said Hutchinson. “Born a digitally native vertical brand, we plan to build on our strength in e-commerce and customer loyalty, leverage EXPR’s expertise in omnichannel retailing and scale through WHP Global’s partnerships in licensing and distribution.”
Post-closing, WHP Global’s portfolio will include more than 10 consumer brands approaching $7 billion in total retail sales, noted Yehuda Shmidman, WHP Global chairman and CEO.
Walmart’s acquisition of Bonobos in 2017 was in keeping with the discounter’s efforts back then to better compete with Amazon by beefing up its online fashion offerings and widen its appeal by buying digitally native, hip brands that targeted millennials and younger consumers.
Along with Bonbos, Walmart had acquired Mod Cloth and Moosejaw. With the deal to sell Bonobos, all three of the brands now have new owners, with Dick’s Sporting Goods acquiring Moosejaw earlier this year. Mod Cloth was sold in 2019
Currently, there are approximately 540 Express retail and Express Factory Outlet stores in the United States and Puerto Rico, the express.com online store and the Express mobile app; and 13 UpWest retail stores and the UpWest.com online store.