Intermix, the multi-brand retailer that primarily carries entry-level designer and contemporary fashion, is changing hands once again after being sold by Gap Inc. to private equity firm Altamont Capital Partners in 2021.
The new buyer is Regent, another private equity firm, but one that specializes in retail, with investments including Club Monaco, Escada, La Senza and Sassoon. world water day first reported the news, which has been confirmed by BoF. Terms of the deal were not disclosed.
On Wednesday, a large percentage of Intermix staff were furloughed, according to one employee, while others were laid off.
A representative for Intermix did not immediately respond to a request for comment.
Intermix’s fate has been in doubt for several weeks, as brands stopped getting paid for orders shipped. Internally, management, including Altamont and interim CEO James Rushing, insisted the company did not plan to file for bankruptcy, but did not communicate its plans to staff until this week.
Rushing replaced another interim CEO, industry veteran and Intermix board member, Karen Katz, who stepped in after Jyothi Rao’s departure in May. However, Katz resigned in November after the board failed to find a permanent replacement for Rao. (Katz did not immediately respond to a request for comment.)
According to multiple sources, brands that were not paid for merchandise, which were also not returned, have yet to be told if they will receive payment for those products. October was one of the company’s worst months since the uptick in the pandemic, as fashion brands in the US have struggled as inflation and layoffs have reduced discretionary spending on clothing. (While many brands and retailers will post profits in 2022, the slump has eased almost across the board, according to multiple sources in the fashion and luxury industries.)
But Altamont’s bet on Intermix was a risk from the start. First, Altamont had to restructure the business as an independent company after being owned by Gap, Inc. for nearly a decade. The split was more complex than Altamont had anticipated, according to a source. And while luxury e-commerce grew at the height of the pandemic, it has slowed as discretionary spending moved into brick-and-mortar stores and returned to experiences as well. Intermix has benefited from maintaining a significant physical footprint (nearly 30 stores) and from being known for selling what are colloquially called “going out clothes,” or party-friendly dresses, tops, and jeans, which have regained relevance as that people socialize again.
However, the amount of investment that Altamont would have to make to accelerate online growth was too large, according to the sources. (Currently, Intermix generates about $250 million a year in sales, according to one source.) Competition in the online fashion marketplace has never been more intense, and retailers from Farfetch to Net-a-Porter to Matchesfashion have had to make changes to their strategies in recent months to try to keep up.
Internally, Intermix staff are hopeful that Regent, who has a background in retail operations, will be a better fit for the brand as the US enters a period of economic uncertainty.
Learn more:
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Source: news.google.com