Levi Strauss & Co. is the latest brand to jump into the women's activewear space.
The denim giant has entered into a deal to buy premium athleisure brand Beyond Yoga. The purchase price of the all-cash deal, expected to close in the fourth quarter, was not disclosed.
The deal comes the same week that Wolverine Worldwide Inc. acquired U.K. activewear brand Sweaty Betty from private equity firm L Catterton for $410 million. Once the transaction is completed, Beyond Yoga will operate as a standalone division within Levi Strauss. Co-founder Michelle Wahler will remain as Beyond Yoga CEO.
Based in Los Angeles, Beyond Yoga was founded in 2015 to promote body positivity, and features inclusive sizing, from XXS to 4X. The company is female-founded, female-run and over 85% female-led.
“I have always had one goal: to make women feel good in their bodies. Beyond Yoga was created with this mission in mind, and it has served as the touchstone of the company,” said Jodi Guber Brufsky, co-founder and chief creative officer of Beyond Yoga. “It was important to me that when the time came, the company would move into the hands of someone whose values matched ours.”
Beyond Yoga has more than doubled its revenue and grown profitability in a disciplined manner during the past three years, according to Levi CFO Harmit Singh. The company expects the acquisition will add more than $100 million to its net revenue next fiscal year, and immediately bolster its earnings.
“This acquisition establishes LS&Co.’s presence in the fast-growing activewear segment with a brand with tremendous growth potential,” said Chip Bergh, president and CEO of Levi Strauss. “The foundation the Beyond Yoga team has built, combined with LS&Co.’s resources, global reach and scale, make me confident that Beyond Yoga will become a powerful growth engine for LS&Co. and help drive our strategic priorities. Beyond Yoga’s values-led approach to business, centered on inclusivity and authenticity, makes it a natural fit to our company portfolio.”
In an interview with CNBC, Bergh said Levi plans to expand the Beyond Yoga brand outside of the United States and open more bricks-and-mortar stores. The deal should also help Levi expand its women’s business, which currently accounts for roughly one-third of sales.
Levi recently reported second-quarter profits of $65 million compared to the pandemic losses of $364 million in the year-ago period. Sales increased 156 percent to $1.3 billion.