Fashion’s Top Locations for M&A Deals in 2025
Fashion dealmaking has surged back into the spotlight with lower interest rates and hopes for a business-friendly political environment under the Trump administration. A flurry of deals, albeit mostly small in scale, has sparked anticipation that big start-ups and well-known heritage brands may be next in line for acquisition. Recently, brands like Kapital, True Religion, and Bonpoint have changed hands, hinting at a wave of potential deals in the near future. Versace, currently owned by Capri Holdings, is rumored to be up for sale after its proposed sale to Tapestry was blocked. Start-ups such as Skims and Vuori, valued at billions of dollars, are also eyeing strategic moves like initial public offerings, waiting for the perfect timing to take the plunge.
The current environment for dealmaking presents both opportunities and challenges. Lower interest rates combined with rising valuations may encourage brands to bide their time for a better offer. Sean Frank, CEO of Ridge Wallets, mentioned, “I don’t want to be the guy to sell when there’s 4 percent interest rates. I’m going to be the guy that sells when there’s 1 percent interest rates.” His brand, generating $200 million in sales and $50 million in profits, is an attractive target, but the right price matters most. As desired brands hold out for favorable conditions, investors predict upcoming deals in 2025 could focus on companies seeking capital infusion to propel growth or sustain operations.
A variety of acquisition targets are likely to emerge this year, reflecting the unique dynamics influencing potential deals. For struggling public companies, the prospect of going private may become more appealing. The Nordstrom family’s decision to privatize their chain, alongside other brands like Allbirds, Figs, and ThredUp experiencing stock price declines and reduced cash reserves, sets the stage for potential takeover opportunities. Opportunity abounds for buyers confident in their ability to restructure these businesses beyond the public market’s scrutiny.
Another trend is the changing of hands among heritage and indie brands. Brand management firms are acquiring established names such as Christian Lacroix and Laura Ashley, along with potential deals involving Jimmy Choo and Versace. Emerging labels are also catching the eye of buyers, with brand accelerator Tomorrow selling off some of its holdings to refocus its portfolio. The closure of e-tailer Matches has left a void in the market, pushing licensing firms to step in and rescue distressed labels like Roksanda. However, not all emerging brands have found saviors, with some, like Y/Project and Dion Lee, closing shop due to a lack of acquisition interest.
In the midst of these shifts, midsize brand consolidation presents a lucrative opportunity. Start-ups with annual sales between $50 million and $100 million are attracting attention from buyers looking to invest in their growth. Eli Yedid, CEO of CP Brands Group, emphasized the importance of customer loyalty and brand integrity when considering distressed brands for acquisition. The focus is on brands with a strong foundation and potential to withstand economic challenges in the long run.
As the landscape of fashion dealmaking evolves, the industry is poised for a wave of transformation, marked by strategic acquisitions, brand resurrections, and consolidation among profitable start-ups. With changing market conditions and shifting consumer behaviors, the coming years are sure to witness a dynamic reshaping of the fashion industry through strategic deals and partnerships.
