NEW YORK — Authentic Brands Group is at it again.
The New York-based brand development and entertainment firm has jumped into the fray and submitted a bid for the London-based Ted Baker men’s and women’s brand. ABG recently finalized its 2.1 billion euro purchase of Reebok and partnered with David Beckham to co-own and manage his business. ABG’s value is now in excess of $21 billion as measured by annual retail sales.
ABG had no comment on a report on Sky News over the weekend, but sources here said the American group submitted a bid last week, the deadline for non-binding offers for Ted Baker. However, because the sale process is different in the U.K. than it is in the U.S., Ted Baker’s board will make the final decision on who it will be sold to from the parties that have submitted offers.
Sources here said that although several firms have submitted offers for the business, there’s no guarantee that the Ted Baker board will accept any of them. If none are deemed acceptable, the company will continue to operate independently.
As reported, the publicly traded Ted Baker officially put itself up for sale earlier this month following a series of bids by New York-based Sycamore Partners to buy the business, all of which were rejected as too low.
The Ted Baker board, in a move intended to maximize value for shareholders, said it would solicit other interested parties and instituted “an orderly process to establish whether there is a bidder prepared to offer a value that the board considers attractive, relative to the stand-alone prospects of Ted Baker as a listed company.” It told anyone interested in submitting a bid to contact its financial advisers, Evercore and Blackdown Partners.
The deal-hungry Sycamore first offered 1.30 pounds a share, and then returned with 1.38 pounds. Ted Baker did not confirm the value of the third offer, although the high-street retailer described it as “improved.” The size of ABG’s offer is not known, but presumably it would be higher than the ones already submitted by Sycamore.
In addition, because Ted Baker also operates a fleet of more than 300 stores around the world, ABG’s bid could be in partnership with Simon Property Group, the mall developer it has partnered with under its SPARC division to buy and manage Brooks Brothers, Eddie Bauer, Aéropostale, Forever 21, Lucky Brand and Nautica. However, Simon only operates stores in the U.S. and most of Ted Baker’s stores are in other countries, meaning that ABG could also be going it alone on this one.
For ABG, the criteria for any acquisition is that it be a global brand with growth potential, much of it centered around licensing opportunities. And in the case of Ted Baker, the company fits the bill, despite its recent struggles.
Ted Baker was founded by Ray Kelvin in 1988 but he resigned in 2019 amid staff complaints about inappropriate physical contact, which Kelvin always denied. After that, the company posted a string of profit warnings and suffered accounting and management troubles. Under the new chief executive officer Rachel Osborne — who was the third person in 12 months to hold that job when she was named to that position last year — the company has been making improvements and is due to report its year-end results in May. In the 2021 fiscal year, Ted Baker reported 352 million pounds in revenue, an operating loss of 98.9 million pounds, and an after-tax loss of 86.4 million pounds.
Since it was founded by CEO Jamie Salter in 2010, ABG has amassed an enviable stable of more than 50 brands, ranging from Sports Illustrated and Greg Norman to Barneys New York and Frederick’s of Hollywood. It operates more than 6,000 stores around the world and its portfolio accounts for over $21 billion in global retail sales.