Under the terms of the transaction, WHP will also make a common equity PIPE investment to acquire 5.4 million newly issued shares of EXPR at $4.60 per share, representing an approximate pro forma ownership of 7.4 per cent, Express and WHP Global said in a joint press release.

American fashion retailer Express and brand management firm WHP Global have entered into a mutually transformative strategic partnership to advance an omnichannel platform that is expected to accelerate long-term growth through the acquisition and operation of a portfolio of brands. The two companies will also form an intellectual property joint venture.

The intellectual property JV is valued at approximately $400 million with WHP to invest $235 million for 60 per cent ownership, EXPR to own 40 per cent. It is intended to scale the Express brand through new domestic category licensing and international expansion opportunities by leveraging WHP’s expertise.

This strategic partnership is expected to capitalise on strength of Express as a fully integrated omnichannel platform. Through synergistic mergers and acquisitions, Express will leverage its platform to drive cost savings and margin expansion.

The partnership is expected to strengthen Express’ balance sheet by providing capital to acquire brands and reduce debt. Express will maintain its disciplined approach to capital deployment and is working with WHP to identify compelling, accretive brand acquisition opportunities. Furthermore, the partnership is also expected to provide WHP with an efficient operating platform to broaden its merger-and-acquisition pipeline.

“Our Expressway Forward strategy has reinvigorated our brand and rebuilt the foundation of our company, paving the way for this bold next chapter in our transformation,” said Tim Baxter, CEO at EXPR.

“The global growth potential of the Express brand and the Express omnichannel platform will give our company a distinct competitive edge as we look to acquire more consumer brands. We are excited to partner with Tim and his management team and view this partnership as a huge win for both of our companies,” said Yehuda Shmidman, WHP Global chairman and CEO.

Fibre2Fashion News Desk (DP)