Bonobos, the popular fashion apparel business owned by Walmart, will be purchased by Express (NYSE:EXPR) and WHP Global for $75 million, the firms announced on Thursday.
WHP will contribute $50 million to buy the brand and EXPR will acquire its operating assets and liabilities for $25 million.
“Bonobos is delivering double-digit sales growth and we plan to continue that momentum while also realizing operating synergies and other economies of scale. This is a compelling addition to our brand portfolio, and I expect the transaction will be accretive to operating income and free cash flow positive in fiscal 2023,” EXPR CEO Tim Baxter said.
Bonobos CEO John Hutchison will become brand president, reporting to Tim Baxter, and the brand will remain headquartered in New York.
WHP Global and EXPR will enter into an exclusive long-term license agreement with multiple renewal options for Bonobos.
In return for royalties paid to WHP, EXPR will run the Bonobos e-commerce store and wholesale operations in the United States.
The acquisition is expected to be accretive to EXPR's operating income and will be free cash flow positive in fiscal 2023.
The transaction is expected to close in EXPR’s second fiscal quarter of 2023.
EXPR +18.7% at 80 cents in after-market trading.