Proenza Schouler Tested Buyout Market

·2 min read

Proenza Schouler tested the market for investors this year, according to industry sources.

The brand, founded and designed by Jack McCollough and Lazaro Hernandez, was being shopped around for a potential sale by investment bank Rothschild & Co. But it seems that process has ended for now.

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Proenza Schouler has been on an outstanding growth trajectory,” a representative for the company said on Sunday. “While we will always consider interest from potential investors, the company is not for sale at this time.”

Rothschild declined comment.

Despite a looming recession, inflation, war in Ukraine, the pandemic and everything else, high-end consumers have been holding up and a group of fashion-forward brands that cater to them have looked to make their move and find a buyer.

In addition to the Proenza exploration, A.L.C. is also said to be looking at the market with the help of Rothschild. Catherine Holstein’s Khaite also acknowledged that it is “evaluating investment options to fuel the next stage of growth.”

And that is generally the intent. Brands look for investment partners and sell them a stake — or control of the company — hoping to get the business to the next level so the whole enterprise grows in value and the brand expands. 

But things can get complicated at even the buzziest of brands as the fashion landscape changes and there are more voices in the boardroom. 

This is familiar territory for McCollough and Hernandez, who first sold a 45 percent stake in the brand to what was Valentino Fashion Group in 2007. 

A group of fashion financiers, including Andrew Rosen, then bought most of that stake in 2011. And private equity firm Castanea subsequently took a minority stake in 2015 that diluted the other shareholders. 

By 2018, the investors were ready to move on and distressed investment specialist Mudrick Capital Management bought into the brand, and later pumped in more money. Mudrick did not respond to a request for comment. 

The business has never quite matched the brand profile, but things seem to be coming together now.

Proenza Schouler Resort 2023 - Credit: Courtesy of Proenza Schouler
Proenza Schouler Resort 2023 - Credit: Courtesy of Proenza Schouler

Courtesy of Proenza Schouler

In June, the designers told WWD that the accessories were taking off with new bag styles, including the Braided Chain and the Drawstring bag in a new metallic leather. Stretch glove leather booties and over-the-knee boots have also been added in footwear. 

Next year, the brand is going to have its 20th anniversary and the designers are already making plans.

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