Wang’s talks with private equity firm General Atlantic are said to have gone quiet lately, while Browne’s Japanese backer is looking to offload its stake and Cushnie et Ochs is believed to be hammering out a deal with an unknown investor.
Wang — the most high profile of the three brands — was seen as close to a deal this summer. But multiple sources noted that the company is still very much a family-run business and that has proven to be something of a sticking point since the interpersonal dynamic can prove challenging for a professional investor.
The designer is also reasserting himself at his own brand after his tenure at Balenciaga ended this fall. Wang is said to have sales in the neighborhood of $100 million and about 25 stores.
The designer has been toying with the idea of outside investment for some time, most likely selling a minority stake to help develop the business.
“There’s definitely an openness,” he told WWD in April. “Capital to open retail is definitely a very important part of the next phase for us, and supply chain and resources, IT — those things can be aided by having a partner.”
If the talks with General Atlantic don’t restart, Wang will have to find another source of capital to supercharge its expansion or content itself with slower growth.
Browne, which is a smaller business but almost as buzzy, could face a change of control if Japan’s Cross Company decides to sell its two-thirds stake, most of which it has held since 2009. Sources said Cross has been deliberate in its approach and that no deal is on the immediate horizon for selling its stake in Browne, which is said to have sales approaching $60 million a year. Multiple investors have looked at the brand, including Sandbridge Capital, a private equity investor affiliated with Tommy Hilfiger.
Sandbridge’s stable already includes stakes in Derek Lam, Tamara Mellon and Karl Lagerfeld.
Representatives from Wang, Browne, Cushnie et Ochs and their prospective investors either declined to comment or could not be reached Wednesday afternoon.
Dealmaking typically slows down as the mania of the holiday season draws near, but it’s been something of a busy stretch for bankers so far this year.
This month alone, American Eagle Outfitters snatched up Todd Snyder and private equity firm Brentwood Associates acquired J. McLaughlin. This past summer, InterLuxe bought A.L.C. in August and Castanea Partners invested in Proenza Schouler in June. In the wings and said to be courting investors are Prabal Gurung and interiors and luxury furnishings company Christian Liaigre.
The rush could be attributed, at least in part, to a difficult market in the fashion and luxury sphere.
Blake Nordstrom, copresident of Nordstrom Inc., put it this way last week: “You look at the scorecard, there are a number of economic indicators that look real positive for the U.S. for the consumer and spending. All we can tell you is, in our business, we saw a slowdown [in the third quarter]. And it was across the board.”
If Nordstrom is slowing across the board, it can’t mean anything good for designer companies, particularly those with businesses that might have a solid brand profile but were already on the edge. On the other hand, a brand that’s performing well stands out all the more against the relatively dour backdrop.
There is a lot of money in the global deal system, with as much as $4.5 trillion that investors need to put to work. But only a part of that is focused on fashion, a business that can be challenging for those not familiar with the ebb and flow of the seasonal apparel business.
The big investors are looking ahead and worrying over a potential downturn in the next year or two and girding for a tougher market.
Private equity giant KKR, for instance, confirmed that it is evaluating “strategic options” for SMCP, parent of the Sandro, Maje and Claudie Pierlot fashion chains, which it acquired two-thirds of in 2013. That would be a relatively quick turn for the investment, but perhaps shrewdly timed since the company’s revenues jumped 32 percent in the first half.
There also continue to be rumbles that Versace, which is 20 percent owned by Blackstone Group, is eyeing an initial public offering. While giving no time frame, Versace’s chief executive officer Gian Giacomo Ferraris last week said the firm was hoping to tap the public markets “soonest.”
One player at a big private equity firm said, “It’s a time to just focus on what you own and try to make value there.”