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Authentic Brands Puts Brakes on IPO

The company will be selling equity stakes to institutional investors

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Forever 21 is one retailer in Authentic Brands’ portfolio. Photography: Shutterstock.com

Authentic Brands (New York) will no longer be working towards a planned initial public offering (IPO), according to CNBC. Instead the company will be selling equity stakes in its business to HPS Investment Partners and CVC Capital, in addition to a range of existing stakeholders. Made known this past Monday, the deal gives the company a $12.7 billion enterprise value.

Originally filing for its IPO in July, with a desired $10 billion valuation, the company reportedly found practicality in remaining private for a few more years. Now its CEO Jamie Salter says the company will plan for a new date in 2023 or 2024.

Salter reportedly said during a phone interview: “The IPO climate is ridiculous … I think we would have gotten a massive valuation … maybe even more than what we sold the business for. But guess what? I’d rather be private.”

This new deal is expected to close in December. BlackRock, a New York-based investment management company, will remain the company’s largest shareholder after the deal closes, a position it’s held since 2019.

The company’s current retailer portfolio includes the likes of Aeropostale, Barneys New York, Forever 21, Nine West, JCPenney, Lucky, Nautica and Brooks Brothers. Reebok may also join the company’s ranks soon, as a deal with the brand (totaling $2.5 billion) is anticipated to close in early 2022, CNBC reports.

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