Supreme Acquired by EssilorLuxottica for $1.5 Billion, Less Than Previous Sale
Supreme, the iconic streetwear brand loved by celebrities and trendsetters, has been acquired by Italian eyewear giant EssilorLuxottica for $1.5 billion. This purchase price is significantly lower than the $2.1 billion VF Corp. paid for Supreme just four years ago.
EssilorLuxottica, known for its eyewear brands like Ray-Ban and Oakley, announced the acquisition on Wednesday, highlighting that Supreme aligns with its strategy to innovate and engage new audiences. Supreme will maintain its distinct identity within EssilorLuxottica’s portfolio, marking the company’s first venture into the apparel sector.
Though EssilorLuxottica is not a household name, its products are ubiquitous, with licenses for brands such as Chanel, Coach, and Dolce & Gabbana.
Founded in 1994 in a New York skateboard shop, Supreme quickly became a favourite among skateboarders, hip-hop fans, and young fashion enthusiasts. The Carlyle Group acquired a 50% stake in the brand for $500 million in 2007, further cementing its value.
Following the announcement, shares of VF Corp. surged nearly 7% in premarket trading. VF Corp. cited “limited synergies” between Supreme and its other brands, making the sale a logical decision.
Retail analyst Neil Saunders of GlobalData commented on the sale, suggesting that VF Corp. had overpaid for Supreme and struggled to integrate and grow the brand. He noted that EssilorLuxottica’s acquisition is risky given the waning popularity of the streetwear aesthetic, but the company’s strong distribution and brand management skills could help revive Supreme’s fortunes.
Observers have pointed to Supreme’s widespread availability and a drop in resale value on platforms like StockX as factors contributing to its decreased allure.
