| NEW YORK, March 13
NEW YORK, March 13 TechStyle Fashion Group,
owner of the Fabletics sportswear line that features celebrity
actress Kate Hudson, is exploring a sale that could value it at
more than $1.5 billion, including debt, people familiar with the
matter said on Monday.
The sale process will test the worth of Hudson's name
recognition, as well as the value of so-called athleisure -
workout apparel to be worn for both sport and everyday life.
TechStyle has hired investment bank JPMorgan Chase & Co
to run an auction for the company, the people said,
cautioning that it was possible that no deal would be reached.
The sources asked not to be identified because the
deliberations are confidential. TechStyle did not respond to a
request for comment, while JPMorgan declined to comment.
El Segundo, California-based TechStyle's venture capital
investors include Rho Capital Partners, KEC Ventures and Trinity
Founded in 2010, TechStyle made its name inviting consumers
to "subscribe" to its various businesses, and then offer them a
curated selection of merchandise.
Its businesses include shoe store ShoeDazzle, apparel and
accessories store JustFab, and Fabletics, which it launched with
Hudson in 2013.
Fabletics remains the marquee brand, with more than 1
million members and more than 4 million social media followers.
It has taken advantage of Hudson's celebrity following as well
as the growing wellness industry that has boomed as consumers
have grown more focused on health and aging.
Like many online retailers, Fabletics, which also allows
non-subscribing "guests" to buy the products, has been expanding
its physical retail footprint, as costs and competition to
market a brand online have risen. Fabletics is looking to open
12 new retail locations this year, bringing its store count to
Competition from other celebrity-endorsed brands has grown
as the industry has attracted more famous names looking to dip
their toes in the space, including R&B singer Rihanna, recording
star Beyoncé and country singer, Carrie Underwood.
J. Crew Group Inc, traditionally known for its preppy
clothing but which has struggled with brand identity, has been
leaning on its own athleisure offerings.
The reach of subscription businesses has attracted corporate
acquirers in the past. Subscription shave business Dollar Shave
Club agreed last year to be sold to consumer giant Unilever Plc
for $1 billion, as the owner of Dove soap sought to
improve its online marketing reach.
(Editing by David Gregorio)