Guess and WHP Global to acquire rag & bone, Guess to contribute $56.5M

Guess and global brand management firm WHP Global announced a definitive agreement to acquire New York-based fashion brand rag & bone. Under the terms of the agreement, Guess will acquire all the rag & bone operating assets, with Guess and WHP Global to jointly own rag & bone’s intellectual property. Currently, the brand directly operates 34 stores in the U.S. and two stores in the U.K., and is also available in high-end boutiques, department stores and through e-commerce globally. In 2023, rag & bone generated unaudited annual revenue of approximately $250M and adjusted EBITDA of $18M. rag & bone will continue to be based in New York City. As part of the Guess portfolio, the rag & bone team will operate as an independent fashion brand with a focus on continuing to provide unique and timeless collections to its customers. Guess and WHP Global have entered into a definitive agreement to acquire rag & bone, under which Guess will contribute $56.5M. Additionally, there is the potential for an incremental earnout consideration of which Guess will be responsible for a maximum of $12.8M, based on preset levels of sales and EBITDA performance over the course of rag & bone’s 2024 fiscal year. Under the terms of the agreement, Guess will acquire and own all the brand’s operating assets and assume the related operating liabilities of the rag & bone business. In addition, a joint venture owned 50% by Guess and 50% by WHP Global will acquire rag & bone’s intellectual property. Guess and the joint venture will enter into a license agreement granting Guess the exclusive right to use rag & bone IP to manufacture licensed products worldwide and to sell licensed products in specified territories in exchange for Guess’ payment of a royalty fee. The acquisition is subject to customary closing conditions, including regulatory approval, and is expected to close during the first quarter of Guess’ 2025 fiscal year.