Iconix Inks Go-private Deal With Lancer Capital

·2 min read

Iconix Brands Group Inc. is leaving the glare of Wall Street.

The brand house — owner of Candie’s, London Fog, Ocean Pacific, Zoo York, Rocawear, Umbro, Marc Ecko and many others — signed a deal to be taken private by Lancer Capital.

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The all-cash transaction, expected to close before the end of the third quarter, values the company at roughly $585 million, including net debt. Lancer will pay $3.15 a share, a 28.6 percent premium over Iconix’s closing price on Thursday.

Bob Galvin, chief executive officer, said the deal comes after a yearlong study of the company’s strategic alternatives.

“After a thorough and deliberative examination of all potential strategic alternatives, the board of directors determined that the transaction with Lancer provides the best value for our stockholders,” Galvin said. “We expect that Iconix will continue developing its brands and supporting its partners as a private company.”

The deal was approved unanimously by the company’s board.

Iconix traces its roots back to 2005 when Neil Cole, who ran Candie’s, changed business models, pioneering an approach to fashion that had the company not making the goods, but owing names and arranging licensing deals. The approach helped the company and many of its brands expand globally, drawing more business out of names that in some cases were looking for new life.

The company flourished for a time, becoming one of the busiest dealmakers in fashion, buying brand after brand and acquiring various interests in brands such as Material Girl, Truth or Dare, Buffalo and Pony. Along the way Iconix sought creative ways to build and extend, for instance staging initial public offerings for the Chinese business of some of its brands.

But Cole stepped down in 2015 and the company soon found itself the target of a Securities and Exchange Commission investigation into its accounting. According to its most recent annual report, Iconix reached a settlement in the matter and paid a civil penalty of $5.5 million in December 2019.

Iconix has remained busy — the company signed 190 license agreements last year, representing $134 million in total minimum royalties, and sold off its Lee Cooper China business.

As the company explored its options, the business model it helped shape has taken off for others.

Jamie Salter’s Authentic Brands Group has been using some of the same playbook, but thinking even bigger, buying Barneys New York, Forever 21, J.C. Penney Co. Inc., Brooks Brothers and Lucky Brand in recent years, inking deals left and right and making new, sometimes unusual connections. That company is eyeing an IPO next month that could value it at $10 billion.

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