With Sequential Brands Group looking to sell off assets, Jessica Simpson just might be buying.
Sources said Simpson and her mother, Tina Simpson, are working with William Susman’s Threadstone to raise money to buy back the Jessica Simpson Collection business.
Representatives for Threadstone, Simpson and Sequential Brands could not be reached for comment Monday afternoon.
Sequential bought the master license for the sprawling lifestyle brand in 2015 and is believed to have maintained it with annual sales of around $1 billion, pre-pandemic. But lately the licensing house has been struggling with a debt load of $463.2 million and a market capitalization of just $41.4 million, according to S&P Capital IQ.
Last year, Sequential’s continuing operations logged sales of $89.8 million and losses of $88.1 million (adjusted losses totaled $14.5 million). Weighing on the net bottom line were non-cash impairment charges of $85.6 million tied to the trademarks of Jessica Simpson, Gaiam, Joe’s and Ellen Tracy brands.
Sequential had been looking to sell off assets, but put that process on hold as it rationalized its cost base during the pandemic. In December, it waded back into the market with “a broad exploration of strategic alternatives” — that essentially put a “for sale” sign on the group and its assets. Last month, the company sold off its sneaker-roller skate hybrid brand Heelys to BBC International for $11 million in cash.
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While the company also owns a host of brands, including William Rast, Caribbean Joe and others, Jessica Simpson is the big prize.
Founded in 2005, the Jessica Simpson Collection operates across a host of categories, including footwear, apparel, fragrance, fashion accessories, maternity apparel, girls’ apparel and home. The brand is available at major retailers, including Dillard’s, Macy’s, Nordstrom, Zappos.com, and is distributed worldwide.
The brand launched at a time when celebrity-based lines were enjoying a burst of popularity, but while many of the businesses from that period have faded, the Jessica Simpson Collection achieved a real critical mass and has evolved with Simpson herself personally and through corporate changes.
The late Vince Camuto bought the brand’s master license for $15 million at its start and helped steer its development, first in footwear and then other categories. Shortly after Camuto’s death, Sequential entered the picture, paying $117.5 million in cash as well as Sequential stock for a 62.5 percent stake in the brand. (The company’s stock closed up 9.2 percent to $27.30 on Friday, having made a 1-40 reverse stock split last year).
Shortly after the deal was signed, WWD asked Simpson about how her business experience up until that point would steer operations for the next decade. She offered a humble take that also revealed how she has remained engaged with the business.
“Every day we’re learning,” she said. “I don’t have all the answers. There’s always another opportunity. I just live that way. I very much live one day at a time, knowing there’s always something I can conquer or get through….Everyone connected with the brand is passionate about how we can connect with the consumer, who may not [necessarily] be a fan of me, but a fan of clothing. They are sticking with me because they can always get what they want.”
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