Nov 14, 2023
Bain Capital is exploring a sale or initial public offering (IPO) of Varsity Brands that could value the U.S. maker of sports uniforms and school yearbooks at more than $6 billion, including debt, according to sources.
Bain has been interviewing investment banks to hire financial advisers that will help the private equity firm come up with a plan to cash out on its majority stake in Varsity Brands, the sources said.
Varsity Brands generates more than $400 million in 12-month earnings before interest, taxes, depreciation and amortization, the sources added, asking not to be identified because the matter is confidential.
Varsity Brands and Bain declined to comment.
Varsity Brands consists of two main businesses, BSN SPORTS and Varsity Spirit.
Varsity Spirit sells cheerleader uniforms and apparel, and also hosts educational camps, clinics and competitions. It also makes school yearbooks, which used to be part of Varsity’s Herff Jones graduation merchandise division. Varsity kept the yearbooks business when it sold Herff Jones to private equity firm Atlas Holdings earlier this year.
Bain acquired Varsity Brands in 2018 from private equity firms Charlesbank Capital Partners and Partners Group for around $2.5 billion, according to news reports at the time.
Buyout firms have been actively seeking exits from apparel businesses this year. L Catterton took German premium footwear maker Birkenstock Holding public in New York last month at a $9.3 billion valuation.
New Era Cap, a supplier of major U.S. sports league headware backed by private equity firm ACON Investments, hired advisors this fall to explore an IPO at a $4 billion to $5 billion valuation. Buyout firm Kelso & Co agreed to sell Augusta Sportswear, a catalog seller of team sports uniforms and apparel, to Platinum Equity, another private equity firm for an undisclosed sum.
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