Ray-Ban Owner EssilorLuxottica Is Buying Supreme for $1.5 Billion
VF Corporation has decided Supreme isn’t so supreme after all.
The American global apparel and footwear company—which currently owns 13 notable brands, such as the North Face, Timberland, and Vans—is selling the famous streetwear label to French-Italian eyewear maker EssilorLuxottica for $1.5 billion in cash, according to a joint statement shared Wednesday.
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VF bought Supreme in 2020 for $2.1 billion, though the company has recently been looking to offload brands to counter a downturn in profits and an uptick in debt. “While we will always look to adjust the VF portfolio from time to time, this transaction gives us increased balance sheet flexibility,” VF president and CEO Bracken Darrell said. “It also supports our overall program to better position the company for long-term growth and more normalized debt levels.”
Darrell pointed out that VF helped Supreme strengthen its presence in the key markets of China and South Korea over the past four years, enabling the label to return to delivering “strong growth.” The brand did lose over $38 million in revenue in 2022, though. Darrell added that a strategic portfolio review concluded there were “limited synergies” between Supreme and VF, making a sale a natural next step.
The deal may have been somewhat expected, but the buyer is quite the opposite. EssilorLuxottica has historically focused on eyewear, with a huge 150-strong portfolio that includes Ray-Ban, Oakley, Barberini, and the like. This is the first time that the company has invested in a clothing brand, but it is confident Supreme will be a perfect fit.
“We see an incredible opportunity in bringing an iconic brand like Supreme into our company,” explained EssilorLuxottica chairman and CEO Francesco Milleri and deputy CEO Paul du Saillant. “With its unique brand identity, fully direct commercial approach, and customer experience—a model we will work to preserve—Supreme will have its own space within our house brand portfolio and complement our licensed portfolio as well.”
Supreme, which currently helms 17 stores across the U.S., Asia, and Europe, also sees the acquisition as a positive. “In EssilorLuxottica, we have a unique partner that understands that we are at our best when we stay true to the brand and continue to operate and grow as we have for the past 30 years,” added Supreme founder James Jebbia. “This move lets us focus on the brand, our products, and our customers, while setting us up for long-term success.”
The deal is expected to close by the end of 2024.
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