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M&A Roundup: LVMH to Control Dior, ABG Takes Majority Stake in Frye, Mad Engine Acquires LRG

This week has seen movement across tiers and product categories with brands finding new homes, and along with them, new financing and new opportunities.

LVMH to take ownership of Christian Dior

LVMH Moët Hennessy Louis Vuitton is set to simplify its ownership structure with the acquisition of the Christian Dior brand.

The Arnault family, which owns a stake in LVMH, has a 74 percent stake in the fashion house. The family is now looking to buy out the minority shareholders for 12.1 billion euros ($13 billion). Funding for a portion of the transaction will be made with shares the Arnaults hold in Hermès. And Dior will sell to LVMH for 6.5 billion euros. ($7.1 billion).

The luxury conglomerate, which owns a vast array of labels like Fendi, Givenchy and Céline, also already owns Dior perfumes and beauty.

“This project represents an important milestone for the Group. The corresponding transactions will allow the simplification of the structures, long requested by the market, and the strengthening of LVMH’s Fashion & Leather Goods division thanks to the acquisition of Christian Dior Couture, one of the most iconic brands worldwide. They illustrate the commitment of my family group and emphasize its confidence in the long-term perspectives of LVMH and its brands,” said Bernard Arnault, chairman and chief executive of LVMH, in a statement.

The Wall Street Journal reports the sale price is three times the brand’s sales, and the deal will boost LVMH earnings by about 3 percent.

ABG takes majority stake in Frye

Authentic Brands Group today announced it has taken a 51 percent stake in the Frye brand.

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ABG, which counts a slate of brands like Tretorn, Hart Schaffner and Marx, Tapout and Spyder in its ranks, is now a co-owner of the brand with Global Brands Group.

“Frye is an American legacy brand which has been synonymous with quality and style for more than a century,” said Jamie Salter, chairman and CEO of ABG. “Global Brands is an incredible business partner and we are thrilled to form a partnership with them on such an esteemed brand.”

Known for quality leather footwear and accessories, Frye is distributed in specialty and department stores as well as 13 freestanding shops in the U.S. Global Brands will now expand the Frye label into new categories like apparel, hosiery and costume jewelry, and open stores and shop-in shops internationally, including three new locations in July.

“Frye is an exceptional brand with a tremendous American heritage,” said Jason Rabin, president of North America, Global Brands Group Holding Limited. “We are excited to enter into this new partnership with ABG to help drive Frye’s global growth and the ongoing evolution of the brand.”

Mad Engine inks deal for LRG

Mad Engine has acquired urban streetwear brand Lifted Research Group (LRG).

Mad Engine is a fully vertical licensed apparel company that expanded into international operations with the acquisition of Xtreme Worldwide in 2014. The company’s offerings span women’s, men’s and kids apparel, loungewear and underwear.

With LRG, Mad Engine makes its first move into branded apparel.

“The Mad Engine team is excited about the opportunity to bring LRG on board. It is a brand many of us grew up wearing and have supported over the years and feels like a natural fit for our first venture into branded apparel,” said Danish Gajiani, CEO of Mad Engine. “The experience of the LRG team and sound infrastructure will serve as a solid foundation and platform to launch the branded division and bring on many additional brands in the future.”