Tory Burch Hires Morgan Stanley to Explore Options, IPO: Sources
Tory Burch might just be ready for a change.
The fashion brand is working with Morgan Stanley to explore its strategic options, WWD has learned.
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That opens up the possibility of an initial public offering — something the company is said to be preparing for, just in case; some other kind of transaction that would bring in new investors, or an outright sale.
“As an independent, private company we do not comment on our strategy,” a company spokesperson said. “We are focused on growing our global brand with a priority on creativity, innovation and operational excellence.”
A spokesperson for Morgan Stanley declined to comment.
Tory Burch founded the company at her kitchen table in 2004 and quickly became a mainstay in fashion, known early on for her ballerina flats and then for successfully projecting her refined, preppy aesthetic around the world.
Along the way, there’s been a slow evolution in the company’s investor base.
The Mexico City-based Tresalia bought a 20 to 25 percent stake in 2009, giving the company a valuation of around $1 billion.
Then in 2012, General Atlantic and BDT Capital Partners each bought minority stakes, picking up shares sold by Burch’s ex-husband Chris Burch at a valuation of $2.25 billion. (That transaction came as the Burches settled a roiling legal dispute over the sale of Chris’ stake as well as his competing venture, C Wonder.)
With two top-shelf financial investors on board, speculation rose that Tory Burch — a designer who had successfully crossed over and built a big business — could be bound for some kind of deal or for Wall Street eventually.
But Burch never seemed keen on the idea of going public and, in 2015, told WWD, “Being private is a luxury and that is something I have always thought.”
And that is a luxury Burch has held on to.
Tresalia hired Goldman Sachs to sell its shares in 2018 only to have the Tory Burch company buy out the stake, concentrating the ownership among the designer, General Atlantic, BDT and other smaller stockholders investors.
General Atlantic and BDT have now held onto their stakes for coming up on 11 years — an eternity in an investment world where many private investment houses have three- to five-year investment horizons.
While it’s not clear exactly how much of the business is owned by Tory Burch, the designer is certainly the one in charge.
Burch is not only the creative force behind the brand, her name is on the front door and her husband, Pierre-Yves Roussel, has been chief executive officer since 2019.
Any investor buying in would likely have to be in sync with Burch.
Alternatively, were Tory Burch to pursue an IPO, the fashion brand would find it has some company and some competition.
Even though the pricing of the much-watched Birkenstock IPO proved to be too aggressive this month, prompting the stock to fall once it hit the open market, there are other fashion companies said to be gearing up for, or weighing the prospects of, an offering. The contenders range from Kim Kardashian’s Skims to fast-fashion megabrand Shein.
While those companies and Tory Burch might not compete for customers, they could compete for investors and attention span as they would all fall under the heading of “consumer” on Wall Street.
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