Guess to Become Private in $1.4 Billion Acquisition by Authentic Brands
Details of the Acquisition
(Reuters) -Guess said on Wednesday it has agreed to be taken private by a group, including its co-founders, CEO and Reebok-owner Authentic Brands, in a deal valuing the designer apparel brand at $1.4 billion, including debt.
Transaction Overview
As part of the transaction, co-founders Maurice Marciano and Paul Marciano, and CEO Carlos Alberini have partnered with Authentic Brands, which will acquire 51% of all Guess' intellectual property. Guess' existing shareholders will own the rest.
Shareholder Benefits
Guess shareholders will receive $16.75 per share in cash, representing a 26% premium to Tuesday's close.
Market Reaction
Its shares jumped nearly 26% at $16.77 in early trading. They have lost about 38% over the last 12 months amid tough competition for consumer dollars and economic uncertainty.
Future Outlook
The deal is the latest in a wave of M&A activities among apparel and footwear companies, including 3G Capital's agreement to take Skechers private, Dick's Sporting Goods' announcement to acquire Foot Locker, and Authentic Brands' purchase of Dockers from Levi Strauss & Co earlier this year.
Taking Guess private will provide the company with greater flexibility to navigate today's complex operating environment and pursue a more focused, long-term strategy, the company said.
Prior to the deal announcement, its co-founders and CEO together owned roughly 40.18% of the company, with Paul Marciano holding 28%, according to data compiled by LSEG.
Guess had received a $13-per-share take-private offer from brand management firm WHP Global in March. It had then formed a special committee to evaluate the proposal.
"The special committee evaluated a number of potential options and unanimously determined that the transaction with Authentic and (existing shareholders) is the best path forward for Guess," said Alex Yemenidjian, chairman of the special committee.
The deal is expected to close in the fourth quarter of fiscal year 2026, subject to regulatory approvals.
(Reporting by Savyata Mishra in Bengaluru; Editing by Shilpi Majumdar)
