Ted Baker sold to Reebok-owner Authentic Brands Group

Ted Baker has been snapped up by Reebok owner, US-based Authentic Brands Group, in a £211 million deal.

The pair have reached an agreement for the all-cash deal, which pays out 110p-a-share, substantially less than the 160p touted earlier this year. However, it is 18.2% more than the 93.1p that Ted Baker, which is listed in London, is trading at currently.

The Ted Baker board will unanimously recommend that shareholders vote in favour of the deal.

Authentic Brands Group (ABG) founder, chairman and CEO Jamie Salter said: “Ted Baker is a highly regarded, uniquely British brand whose strong fashion credibility resonates with consumers around the world.

“We are excited to build on the brand’s global foundation through a business model focused on licensing, wholesale, retail, digital and strategic marketing partnerships. Under ABG’s ownership, we believe that Ted Baker is poised for continued growth and success.“

READ MORE: Ted Baker cashflow under pressure as it trades without credit insurance

Ted Baker interim chair Helena Feltham said: “The Ted Baker board believes the offer, which is supported by Ted Baker shareholders with a majority of shares, represents a fair value for shareholders and balances the company’s growth prospects with the risks of the uncertain economic environment in which the business is operating.”

“The Ted Baker board believes that ABG will be a strong and supportive owner of the business. We are confident that with ABG’s experience, reach and investment, the Ted Baker brand will be capable of achieving its long-term global potential.”

ABG, which was understood to have pulled out of the race to buy Ted Baker in June, said it is well positioned to accelerate growth and enhance Ted Baker’s value. 

The firm said: “ABG intends to use its global network of established operating partners with deep industry expertise, together with its business model that combines leading brand management capabilities, to enhance Ted Baker’s revenue and profitability across merchandise categories and geographic regions as it has for other acquired brands including Reebok, Brooks Brothers, Nautica, and Eddie Bauer.”

It plans to restructure the business to “maximise its future potential”.

It would separate Ted Baker into an intellectual property holding company, which ABG would control, while one or more operating companies would manage the retail, ecommerce and wholesale operations of the brand.

ABG believes there are “significant growth opportunities” for Ted Baker in North America.  The firm may potentially combine Ted Baker’s operations with those of Sparc, a retail, ecommerce and wholesale joint venture that it has with regional shopping mall and outlet operator Simon Property Group.

ABG owns more than 50 consumer and entertainment brands, including Juicy Couture, Forever 21 and David Beckham. It has more than 8,500 stores and shop-in-shops and its brands collectively turn over more than $21 billion in annual global retail sales.

The group, which counts CVC Capital Partners, BlackRock, General Atlantic, and Lion Capital as shareholders, is valued at $13 billion.