Walmart Sells Bonobos
Posted on 04/14/2023
Institutional favorite Walmart has decided that clothing boutique Bonobos isn’t in its interest any more, and the company has plans to sell it to WHP Global and Express Inc. for US$ 75 million. WHP, owner of Toys R Us, will pay US$ 50 million, with Express picking up the rest, US$ 25 million. Walmart bought the brand for US$ 310 million in 2017, taking a 76% haircut on the deal. Bonobos’ founder Andy Dunn left Walmart in 2020 to build a second startup called Pumpkin Pie, which is a social media app for building platonic relationships.
Bonobos says it is “a menswear company like no other. We’ve made every effort to make sure you got from point A to the best-fitting pants you’ve ever worn with ease.” Customers make an appointment for measurements at Bonobos, with shops located in upscale malls or city centers. The company offers style advice and guides to enhance the shopping experience.
Norway’s US$ 1.2 trillion Government Pension Fund Global is an established fan of rollbacks, with 17,988,929 shares in the retail heavyweight.
Advisors
Citi is serving as financial advisor to Bonobos and Fenwick & West LLP is serving as its legal advisor. Weil, Gotshal & Manges LLP and Hogan Lovells are serving as legal advisors to Walmart for this transaction.
Failed
Walmart has tried to grow an e-commerce business to compete with Amazon.com, Inc. Walmart spent US$ 3 billion to buy Jet.com, an e-commerce platform. Jet.com is Walmart’s now defunct e-commerce arm. Earlier, Walmart also bought women’s clothing company and online retailer ModCloth (sold Modcloth in 2019), ShoeBuy (sold in 2020), and Moosejaw for US$ 51 million in 2017 (Walmart eventually sold it to Dick’s Sporting Goods in February 2017). In June 2019, in the wake of slumping sales through the Jet.com site in the period following the acquisition, the majority of Jet.com employees were transferred to work on the Walmart.com site and Simon Belsham, the president of Jet.com, left the company. On May 19, 2020, Walmart disclosed that it was shutting down Jet.com, which they did on June 4, 2020 directing visitors to use Walmart.com instead.
Keywords: Norway Government Pension Fund Global.
