SYDNEY — LVMH Moët Hennessy Louis Vuitton-backed L Capital Asia has bought 40 percent of Melbourne-based technical sportswear manufacturer 2XU, making its second investment in Australia in eight months.
The Australian company and its existing equity partner Lazard Australia Private Equity announced the news Monday. They did not dispose a price for the deal but sources said the stake is worth approximately 75 million Australian dollars, or $68.3 million at current exchange.
“2XU signifies a winning proposition of best in class product preferred by Pros across varied sports, with design and innovation rooted in Australia, one of the world’s most active countries, coupled with an extremely passionate and driven management team,” said L Capital Asia managing partner Ravi Thakran. “We firmly believe that the combination of this strong proposition, with our unique approach to performance enhancement across our portfolio companies will help the brand in achieving its full potential as a strong, globally recognized performance sportswear brand.”
Founded in 2005 by former Australian advertising executive turned mens underwear manufacturer Clyde Davenport and two New Zealanders, Aiden Clarke and former professional triathlete Jamie Hunt, 2XU (pronounced “Two Times You”) operates 12 standalone stores within Australia, two in the US and wholesales to 50 markets. The company claims to have achieved revenue growth in excess of 40 percent per annum over the past five years.
The product range was developed in partnership with the Australian Institute of Sport and RMIT university and customers include Triathlon Australia, Yachting Australia, the Melbourne Ballet Company, Tennis New Zealand and the US military, including the Navy Seals.
The brand’s compression wear, which accounts for 50percent of sales, has become increasingly popular with mainstream consumers, with 2XU’s signature “X”-emblazoned compression tights seen in gyms, yoga classes and running tracks Australia-wide.
In November 2011, Lazard Australia Private Equity acquired a 30 percent stake for 26 million Australian dollars, or $27 million at exchange rates of that time, according to Lazard Private Equity Australia director Gareth Young. He said that 2XU expects to achieve sales of 65 million Australian dollars, or $59.2million, in the 2013-2014 financial year.
In April this year, L Capital Asia acquired a 49.9 percent stake in Australian bush outfitter RM Williams for an estimated 50 million Australian dollars, or $52.5 million at exchange rates of that time.