Gap Inc., seeking to tap deeper into the growing but increasingly competitive activewear arena, has acquired the Athleta women’s sport and active apparel company for $150 million in cash.
The direct-to-consumer company is based inPetaluma, Calif. It currently does not operate any stores, which could be an opportunity for Gap.
Athleta will become the “fifth tab” on Gap Inc.’s online platform, called Universality, which enables shoppers to browse and buy all of the company’s brands in one shopping cart with a single shipping fee. Athleta’s products will be sold online alongside Gap Inc.’s other divisions: Gap, Banana Republic, Old Navy and Piperlime.
“Athleta is a great success story with loyal customers that will now become part of the Gap Inc. family of brands,” Glenn Murphy, Gap Inc.’s chairman and chief executive, said. “This strategic acquisition complements our brands perfectly and allows us to leverage our new online platform to expand into this significant retail sector.”
The 10-year-old Athleta is considered a lifestyle brand, combining style and function for yoga, running, skiing, tennis, cycling, triathlons, golf, walking, climbing, hiking, snowboarding and surfing. Customers can purchase Athleta product online or through the company’s catalogue. Ninety percent of the merchandise is private label. Athleta circulated 13 million catalogues in 2007 and said it would circulate 21 million this year. The brand targets women ages 25 to 55.
Joe Teno, the current ceo of Athleta, will remain as president of Athleta at Gap Inc. upon the completion of the deal. He will report to Toby Lenk, president of Gap Inc. Direct. Athleta has 250 other employees and a distribution center in Grove City, Ohio.
The acquisition represents a major step forward by Gap to tap the $31 billion women’s athletic market. The Gap does operate Gap Body, which offers some active apparel.
However, the deal is somewhat of a surprise, coming as Gap continues to struggle to repair its divisions. “The brand isn’t bad, but with all the problems Gap has, why take on another business, especially in an area where there is tons ofcompetition?” said one source, who estimated Athleta’s volume at around $100 million. The source was referring to activewear behemoths like Nike and Adidas as well as fast-growing firms such as Lululemon.
Louise Callagy, a spokeswoman for Gap Inc., said Athleta is profitable and that its sales volume would be included in total online sales, which are disclosed each quarter. She declined to comment on the $100 million volume report.
Asked if Athleta stores could be opened, Callagy replied the focus for now would be on the online and catalogue businesses. “Of course, we will consider whether other growth vehicles such as brick-and-mortar stores will make sense over time,” she said.
As far as operating both Gap Body and Athleta, she said, “There is plenty of room in the market for both.”
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast