Canada Goose draws take-private bids valuing it at $1.35 billion as Bain Capital weighs exit

Canada Goose's controlling shareholder, Bain Capital, has received bids aimed astatine taking the luxury parka-maker backstage astatine a valuation of astir $1.4 billion, according to radical acquainted with the matter.

Bain Capital is looking to offload its holding successful Canada Goose, the radical said, with Goldman Sachs advising connected the sale. All existing offers purpose to privatize the institution listed successful Toronto arsenic good arsenic New York, according sources who asked not to beryllium named arsenic the accusation is confidential.

Private equity firms Boyu Capital and Advent International person made verbal offers, valuing Canada Goose astatine 8 times its 12-month mean net earlier interest, taxes, depreciation and amortization, translating into a valuation of astir $1.35 billion, the radical said.

Other funny buyers see Bosideng International, a Shanghai-based shaper of down jackets, and a consortium formed by private-equity steadfast FountainVest Capital and Anta Sports Product — the duo had led a woody successful 2019 to get Finland's Amer Sports, proprietor of Wilson tennis rackets.

The bid to instrumentality Canada Goose backstage is not surprising, according to respective manufacture watchers, arsenic going backstage would springiness buyers greater autonomy to crook astir the company, without other scrutiny of regular fiscal disclosures.

Bain Capital is holding disconnected connected a determination until much offers rotation in, the radical said, adding that erstwhile a purchaser is selected, owed diligence is expected to instrumentality little than 2 months earlier the woody is signed.

Canada Goose's New York-listed shares person gained implicit 21% truthful acold this year, lifting its marketplace worth to $1.18 billion. Though inactive a acold outcry from its 2018 highest of $7.7 billion, a twelvemonth aft it went public, the valuation represented outsized returns for Bain from the reported $250 million level erstwhile it took power successful 2013.

As of March, Bain owned astir 60.5% of its aggregate voting shares, which transportation 10 times the voting powerfulness of the company's publically traded stock, giving Bain 55.5% of full voting powerfulness astatine the firm, according to a regulatory filing.

Bain's planned exit comes arsenic Canada Goose has been struggling to prolong maturation momentum successful respective cardinal markets, with analysts questioning its marque positioning and selling strategy astatine a clip erstwhile consumers are becoming cautious astir big-ticket apparel purchases.

For the twelvemonth ended successful March, the company's gross fell 1.1% connected a changeless currency basis from a twelvemonth earlier to $1.35 cardinal Canadian dollars, arsenic income successful its important markets including Canada, China and the EMEA portion — comprising Europe, Middle East, Africa and Latin America — declined 2.4%, 1.7% and 12.1%, respectively.

That represented a crisp slowdown successful its planetary gross growth, which had risen 23.2% successful 2022, 10.9% successful 2023 and 9.6% successful 2024 connected a changeless currency basis.

The income diminution successful China — which hosts astir fractional of the company's planetary stores — signals a crisp downturn compared with a leap of 47% leap successful income successful fiscal twelvemonth 2024, erstwhile China overtook Canada arsenic the company's biggest market.

In the latest 4th ending successful June, a seasonally dilatory play for the winter-coat maker, Canada Goose posted a bigger-than-expected nett nonaccomplishment of CA$125.5 million, widening from a CA$74 cardinal nonaccomplishment successful the aforesaid play past year.

The exit besides came arsenic Bain's 12-year power of Canada Goose has acold exceeded the emblematic private-equity concern rhythm of astir 5 to 10 years, making an exit a earthy next-step.

"Bain's Canada Goose woody represents a classical PE money rhythm — acquiring the brand, taking it nationalist and present looking to exit," said an manufacture seasoned who did not privation to beryllium named, adding that an exit aft 12 years is acold from ideal.

"The occupation with Canada Goose is that it neither does functional deterioration peculiarly good nor manner peculiarly good from the user perspective," said Yaling Jiang, laminitis of user consultancy steadfast ApertureChina.

The institution tends to settee for mid-tier brands and celebrities successful their marketing, straying from its halfway spot successful winterwear, Jiang added. "The marque feels rootless and faceless."

She besides pointed to inconsistency successful Canada Goose's messaging and actions: "It's awkward erstwhile they slope connected lifelong prime and past they look a fig of prime scandals successful China ... and erstwhile they telephone themselves luxury manner but galore consumers expect to bargain them at [mass market] outlets," Jiang said.

Canada Goose has flagged that higher U.S. tariffs could rise earthy worldly and compliance costs, perchance starring to terms hikes that hazard eroding the company's competitiveness successful immoderate markets.

While withholding its existent fiscal year's forecast implicit uncertain commercialized environment, the institution said it was successful bully signifier to negociate the interaction of tariffs, arsenic 75% of its items are made successful Canada and are presently exempt from U.S. tariffs owed to compliance with the United States-Mexico-Canada Agreement.

The outerwear shaper is reportedly pushing into sweaters, sunglasses and footwear arsenic it seeks to alteration from being a parka specializer to an all-season marque with sustained income during off-peak seasons.