Authentic Brands puts off IPO after investing in company

After getting a big new investment from two private equity firms, the company behind brands such as Sports Illustrated, Eddie Bauer, and Brooks Brothers plans to delay its initial public offering.

A company called Authentic Brands Group LLC, which develops and licenses its brands to retail operators, sold stakes to CVC Capital Partners and HPS Investment Partners in a deal that values the company at $12.7 billion, including debt.

The investment will deliver roughly $3.5 billion of fresh capital for Authentic Brands, with the largest piece coming from CVC, according to people familiar with the matter. One person said that the total includes additional funds coming from existing investors.

It is not known what percentage of the company CVC and HPS will own.

Authentic Brands, which had filed paperwork in July to launch an offering that would have listed its shares on the New York Stock Exchange, said it plans to put off an IPO until 2023 or 2024.

ABG's goals haven't changed at all, a spokeswoman for the company said. We pursued an IPO to bring value to ABG and its shareholders. The onboarding of new equity partners is a big part of the success of the company. Some of its existing shareholders would sell CVC and HPS's ownership stakes, according to Authentic Brands. The owner of the largest share of Authentic Brands will be Inc.'s BLK 0.48% private equity business. Other shareholders include Inc. SPG 0.75% Leonard Green Partners, Singapore sovereign-wealth fund GIC Pte. Authentic Brands manages its personal branding with the help of Authentic Brands, a former NBA star Shaquille O Neal and the former NBA star Shaquille O Neal.

In the last year, Authentic Brands had $488.9 million in revenue, a growth of 1.8% year over year, despite the coronaviruses epidemic that has hit traditional shopping. Its net income was $211 million after distributions to non-controlling owners.

Authentic Brands, along with Simon, and the real-estate arm of Brookfield Asset Management Inc. last year after its bankruptcy, were part of the real-estate arm of Brookfield Asset Management Inc. It was also from Adidas AG over the summer.

Authentic Brands owns intellectual property, controlling marketing and development. It deals with hundreds of licensees who source products, manage inventory and operate retail stores. Authentic Brand licensees have 6,000 stores, with e-commerce sales representing about 18% of gross merchandise value last year.