Brooks Brothers wants to know its options — including a possible sale.
The venerable American retailer has hired the investment bank PJ Solomon to explore and analyze strategic options, according to sources.
Neither Claudio Del Vecchio, the owner and chief executive officer of the privately held company, nor a Brooks Brothers spokesperson could be reached for comment on Wednesday. PJ Solomon declined to comment on the report.
The rumors that the Italian billionaire was considering selling the company started bubbling around this time last year. At the company’s annual Thanks and Giving holiday event last November, Del Vecchio downplayed the report, saying he was “not trying to dump the company. People come to me and inquire all the time. But are we trying to sell the company? No.”
However, the speculation heated up earlier this week when an Italian newspaper reported that Del Vecchio was mulling the idea of selling the company and a number of investment funds have looked at the books.
Sources here have said that the company continues to do well and there is no fire sale in the works. Instead, the 62-year-old Del Vecchio is simply formalizing the process to see what opportunities might be available — and there’s no guarantee that a sale will happen.
If Brooks Brothers were to be sold, it would mark the second historically significant American business that may change hands. Tiffany & Co., which was founded in 1837, has been targeted for a takeover by LVMH Moët Hennessy Louis Vuitton, which has offered to buy the company for $120 a share, or $14.5 billion.
Brooks Brothers reportedly has sales of more than $1.1 billion and has more than 250 full-price and outlet stores in the U.S. and more than 700 internationally in 50 countries.
Del Vecchio, the son of Luxottica founder and chairman Leonardo Del Vecchio, purchased Brooks Brothers from Marks & Spencer for $225 million in 2001. Although at the time he was head of Retail Brand Alliance, which owned Casual Corner among other retail brands, it was Brooks Brothers that soon became the jewel in the crown.
He had been a fan of the brand since he was a young man when he realized that the men’s wear icon and chairman of Fiat, Gianni Agnelli, was a Brooks Brothers customer. When Del Vecchio arrived in the U.S. in 1982, the first store he visited was Brooks Brothers.
Since buying the brand, Del Vecchio has proven to be a white knight for an iconic American business that celebrated its 200th anniversary in 2018. In an interview at the time of the milestone birthday, Del Vecchio said that if he hadn’t stepped in to save the business, “there’s very little possibility that we would have made it to our 200th anniversary. The brand might have still been alive, but it wouldn’t have been what it historically was.”
Right after purchasing the brand, Del Vecchio set out to return Brooks to its former glory, but with a careful and respectful approach.
“We fixed Brooks Brothers, we did not transform it,” he has said.
He upgraded the merchandise mix, revamped its stores, expanded overseas and added several product categories. He hired Thom Browne in 2007 to create a collection called Black Fleece that started out as a marketing stunt but resulted in a business that drew in an edgier customer and had sales of $10 million at its peak. Del Vecchio also hired Zac Posen in 2014 as creative director to grow Brooks’ women’s collection, which has consistently accounted for around 20 percent of overall sales.
The entrepreneur has aggressively expanded Brooks’ international presence, with overseas sales now accounting for around 35 percent of the total business. Its largest markets are Japan, where it has had a lucrative business for 40 years, as well as China, where the retailer is growing quickly.
Del Vecchio’s other Brooks Brothers-related holdings include the company’s manufacturing facilities in Long Island City, N.Y.; Garland, N.C., and Haverhill, Mass. The latter is home to Southwick, another business he rescued in 2008 by buying the plant that created the brand’s suits, sport coats, trousers and dress coats and retaining all of its employees.
Through it all, Del Vecchio has always had an eye to the past and a vision for the future and done what he could to position the brand for the next 200 years.
“My job is to do the best I can,” he said on the anniversary in April 2018. “I’m just one chapter in the book. When I bought the company, I wanted to make it strong enough to celebrate its 200th anniversary and we did that. Everything else, we have to earn. This is all about Brooks Brothers, it’s an institution.”
Brooks Brothers was founded in 1818 by then-45-year-old Henry Sands Brooks as a men’s haberdashery, H. & D.H. Brooks & Co., on Catherine and Cherry Streets in lower Manhattan. It was later renamed Brooks Brothers in honor of his four sons: Elisha, Daniel, Edward and John.
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