Hong Kong-based Lever Style’s acquisition game is still going strong.
The apparel manufacturer is continuing to amass new capabilities after purchasing Delta Industries Limited, a denim factory, in December, along with China-based knitwear company Vista Apparels and performance gear maker Liwaco Overseas Marketing Limited in August.
Now, Lever Style—which has pioneered a high-mix, low-volume production strategy to serve direct-to-consumer companies like Bonobos and Stitch Fix—has acquired a vertically integrated performance wear brand in its bid to offer a wider array of clothing categories to its clients.
On Wednesday, the company announced the purchase of Hong Kong-based technical activewear company Champion System. Both a brand and a manufacturer, the group occupies a “unique space” between business-to-business and business-to-consumer, Lever Style executive chairman Stanley Szeto told Sourcing Journal.
The performance apparel maker, with a factory located in China, is known in cycling and triathlon circles for its highly technical apparel, which it releases under its own name to both professional teams and recreational clubs across the globe. While it would seem a niche category, Szeto said the garments are favored for a proprietary aerodynamic technology that Champion System developed in a wind tunnel test rig at Hong Kong’s University of Science and Technology.
The group is also the official race kit maker for Hong Kong’s Olympic Cycling team, and crafted jerseys and Speedsuits for New Zealand’s National Cycling team for the 2016 games. According to Szeto, the company has been in talks with China and U.S. teams about Aero Speedsuits for this year’s Tokyo Olympics. Champion System also produces training apparel for Hong Kong’s Special Duties Unit, nicknamed the Flying Tigers, which Szeto characterized as an equivalent to the U.S. Navy SEALs.
Lever Style has long been interested in rounding out its cache of manufacturing bodies with athletic apparel, Szeto added, and he believes there’s an opportunity to dramatically expand the Champion Systems business by courting a new class of players. “We’re already talking to a couple of professional eSports teams about clothing for gamer athletes,” he said, adding that contracts with the NFL, NBA and MLB have been locked up by big names like Nike, Adidas and Under Armour for years. “Champion Systems may not be able to get its hands into that business,” he added, “but some of these emerging sports, like gaming, could be a good way to go.”
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Lever Style also sees opportunity to attract more athletic apparel clients, and serve existing performance customers like Mammut, Helly Hansen and Lindeberg with this new capability. “This is really high-end technical sportswear—and we know fashion,” he said. “So when you combine the two, we’re in a great position to come up with interesting athleisure products.”
The company’s fourth acquisition comes just months after its last announcement in December. Szeto said that amid the past year’s turbulence, having an asset-light business model has given the company the “financial firepower” to prioritize deal-making with quality manufacturers in need of a leg up. Lever Style does not own its physical factories, he added, just the IP and “technical know-how” of its subsidiaries, making it easy to shift production to new locales that offer more beneficial terms, and cutting out the cost of managing physical space.
Szeto said Lever Style’s track record of 2020 acquisitions has also lent it “preferred bidder” status. “We’ve showed the world and financial advisors that we’re serious about our bids,” he said. What’s more, with so many different factory arms bringing varied expertise to the company, “we have…the capability to produce the whole wardrobe,” he added.