Aritzia announces acquisition of Reigning Champ
by CM Staff
Aritzia will acquire 75% of Reigning Champ based on a total enterprise value of approximately $63 million, with the remaining 25% equity interest purchased through 2026.
Reigning Champ (CNW Group/Aritzia Inc.)
VANCOUVER — Aritzia, a vertically integrated clothing manufacturer and brand, is accelerating its product expansion strategy for men’s through an agreement to acquire Reigning Champ, a manufacturer of premium athletic wear. Aritzia will acquire 75% of Reigning Champ based on a total enterprise value of approximately $63 million, with the remaining 25% equity interest purchased through 2026.
“We’re excited to welcome Reigning Champ. Rooted in classic, timeless athletic wear, their brand has been carefully curated for just short of fifteen years,” said Brian Hill, Founder, Chief Executive Officer and Chairman of Aritzia. “Building on Aritzia’s strong start to fiscal 2022, this acquisition meaningfully accelerates our product expansion into men’s while bringing incremental growth to our already surging women’s eCommerce and U.S. businesses. Capitalizing on our world-class operational expertise and infrastructure, men’s, merchandised independently, will become a meaningful part of Aritzia’s platform through our Reigning Champ acquisition.”
Inspired by the culture of sport, Reigning Champ is a designer and manufacturer of premium athletic wear, that will now be able to leverage Aritzia’s infrastructure.
“As an innovative design house offering exceptional experiences through its online and retail platforms, Aritzia’s well-established track record as a successful direct-to-consumer business is one that we’ve long admired. Leveraging Aritzia’s unparalleled world-class infrastructure and expertise, this partnership provides an exciting path forward to elevate Reigning Champ to the next level as a premium athletic wear brand. We look forward to working with the incredibly talented Aritzia team to capitalize on the limitless opportunities ahead,” said Craig Atkinson, Co-Founder and Chief Executive Officer of Reigning Champ.
Atkinson is joined on Reigning Champ’s senior leadership team by Co-Founder and Vice President of Manufacturing Chris Nordee and Chief Financial Officer Paul Heathcote. They will continue operating the business in partnership with Aritzia through a transition period of approximately five years to allow both businesses to focus on sustaining their unique brands and cultures.
Aritzia will acquire 75% of Reigning Champ based on a total enterprise value of approximately $63 million. The remaining 25% equity interest held by Reigning Champ’s management shareholders will be converted into Aritzia shares in up to three instalments from 2024 to 2026. Reigning Champ is expected to deliver approximately $25 million in revenue and $5 million in adjusted EBITDA in calendar 2021. The acquisition is expected to be completed in June 2021, subject to customary closing conditions and approvals. Aritzia will fund the initial purchase with cash on hand.
