Equistone Partners Europe has acquired a majority stake in Defshop, a German streetwear and hip-hop clothing retailer. No financial terms were disclosed. KPMG provided financial and tax advice to Equistone on the transaction. The deal is expected to close at the end of September 2017.
Funds managed by Equistone Partners Europe (“Equistone”), one of Europe’s leading mid-market private equity investors, have invested in DefShop, a leading German multichannel retailer for streetwear and hip-hop clothing. Equistone will acquire a majority stake in DefShop from the founder of the business, Alexander Büchler, and his family, who will together retain a minority shareholding. DefShop’s management team will also acquire a minority stake in the business. The financial terms of the deal are undisclosed and the acquisition remains subject to clearance from anti-trust authorities.
DefShop was founded in 2006 in Berlin by Alexander Büchler and has quickly grown into a multichannel platform with two physical stores. The company’s product range comprises over 25,000 articles from approximately 350 brands, including Adidas, Nike, Jack & Jones, and Converse. This product range spans from jackets, hoodies, and jeans through sweatpants and shoes to accessories such as caps, belts, jewellery, and sunglasses. In addition, under its Herobrands umbrella, DefShop offers a large portfolio of proprietary own brands such as DNGRS, Just Rhyse, and Bangastic, as well as licensed brands such as Thug Life and Eckô. These are distributed through the B2B platform Roadmap1, through which DefShop also connects to its network of large-scale European retailers that includes Amazon, eBay, Vaola, and Rakuten.
DefShop currently employs around 180 people and serves approximately 935,000 customers across Europe. In 2017 DefShop is projected to generate revenues of c. €64m.
Alexis Milkovic, Partner at Equistone, said: “DefShop has grown impressively within an extraordinarily exciting segment of the fashion industry and is regarded by teenagers and young adults as an institution and style authority for streetwear and hip-hop clothing. This positioning provides an outstanding basis for DefShop’s next phase of growth, which we are excited to support. As a priority we are looking at accelerated growth in the B2B area, the further internationalisation of the business, strategic add-on acquisitions, and the strengthening of DefShop’s own-brand strategy.”
Alexander Büchler, founder and CEO of DefShop, commented: “In Equistone we know that we have a middle-market investor with strong capital reserves and expertise in the retail and fashion industries by our side. Together with Equistone we plan to continue driving the expansion of DefShop within this hugely promising market.”
Alexis Milkovic and Maximilian Göppert led the transaction for Equistone. Equistone was advised by KPMG (financial & tax), PwC (commercial due diligence), P+P (legal due diligence / SPA / management), Shearman & Sterling and Latham & Watkins (banking), GCA Altium (debt advisory), h&z (operational due diligence), and Blue Summit Media (marketing). The completion of the transaction is expected to take place at the end of September 2017.