Galaxy Universal to acquire And1, Avia, Gaiam and SPRI
Galaxy Universal LLC has agreed to acquire the And1, Avia, Gaiam and SPRI brands in the bankruptcy proceedings of Sequential Brands Group Inc. for approximately $ 330 million.
The transaction is subject to satisfaction or waiver of customary closing conditions, including court approval, and is expected to close by mid-November 2021.
August 31 Sequential Brands Group has announced that it has started voluntary Chapter 11 proceedings in the U.S. Delaware District Bankruptcy Court with plans to divest its brand portfolio or sell the company.
As part of the filling, Sequential Brands has agreed to sell its active division brands, including Gaiam, Avia, SPRI and And1, to Galaxy Universal for $ 333 million. Galaxy will serve as a bidder to explore higher bids for the active segment as part of Sequential Brands’ bankruptcy filing. An auction scheduled for last Friday was called off as no further qualified bids materialized.
Other brands owned by Sequential include Jessica Simpson, William Rast, Joe’s Jeans, and The Franklin Mint.
Galaxy Universal, a portfolio company of Gainline Capital Partners, said the transaction is a continuation of its strategy of vertically integrating strong brands under a single management operation that controls marketing, design, sales, sourcing and manufacturing.
Galaxy is led by CEO Eddie Esses, a veteran of the footwear industry and brand management. âIn this ever-changing market, we are strategically positioned to meet the ever-changing expectations of customers. Galaxy is able to deliver top brands, unique designs and improved quality at exceptional values, âEsses said.
This spring, Galaxy finalized the acquisition of Apex Global Brands, including Hi-Tec, Magnum and Tony Hawk. It also has licensing agreements with brands like Justice, London Fog, and others.
Allan Weinstein, Managing Partner of Gainline, said: âThe rich heritage of these brands combined with the passion, experience and unmatched track record of Mr. Esses and his team sets this investment apart. We are excited to support this team and to advance the partnership with Galaxy as the company grows and future acquisition opportunities arise. “
KKR led the debt financing of the acquisition and will participate as a co-investor.
âGalaxy’s vertical integration strategy and its strong specialization in active products position the company to take these great brands to new heights,â said Lauren Krueger, Managing Director of KKR. âWe are delighted to fund the transaction and invest in the future of the company as a strategic partner with the Galaxy and Gainline teams. “
KKR invests in Galaxy through certain private credit managed accounts.
Houlihan Lokey Inc acted as exclusive financial advisor and Willkie Farr & Gallagher LLP as legal advisers to Galaxy Universal LLC. Credit Suisse Securities (USA) LLC acted as the exclusive placement agent of Gainline Capital Partners. Province acted as financial advisor and King & Spalding LLP as legal advisor to KKR. Stifel and its subsidiary Miller Buckfire acted as financial advisers and Gibson, Dunn & Crutcher LLP acted as legal advisers to Sequential Brands.