Brand management company WHP Global (New York) will spend a total of $260 million to acquire a 7.4 percent stake in struggling fashion retailer Express Inc. (Columbus, Ohio).
WHP Global is investing $235 million to form a joint venture with Express that will give it a 60 percent controlling interest in the partnership. The brand manager will also spend $25 million to acquire 5.4 million newly issued shares of Express at $4.60 apiece.
The two companies describe the deal as an effort “to advance an omnichannel platform which is expected to drive accelerated, long-term growth through the acquisition and operation of a portfolio of brands.”
“Our partnership with WHP will drive greater scale and profitability of the Express brand through their category licensing and international expertise and strengthen our balance sheet,” said Express CEO Tim Baxter in a news release. “We expect to accelerate our growth by acquiring multiple brands in partnership with WHP and operating them on our platform. Both of these are expected to drive shareholder value.”
Express unveiled the WHP deal the same day as it released results for the third quarter, which reflected its ongoing difficulties. For the period, Express reported a comparable sales decline of 8 percent and an operating loss totaling $30 million.
In March of 2021, WHP Global acquired a controlling interest in TruKids, the parent company of Toys “R” Us. Since that time, WHP Global has reignited the toy retailer’s brick-and-mortar efforts with plans to open 400 shop-in-shops at Macy’s.