E-commerce Giant Walmart sells Bonobos for $75 Million to WHP Global and Express

We have seen that there are some times when hard decisions need to be taken because of the fact that if something is not working for you then there is no reason but to accept it and sell the asset which is not performing. That is exactly what Walmart is doing these days as it sees good growth in the retail as well as e-commerce sector as well. We are talking about Walmart’s decision to offload the clothing brand Bonobos from its portfolio. Yes, Walmart has decided to sell this brand after acquiring it in 2017 for well over $310 million. At that time, Walmart’s President wanted the brand to grow its e-commerce presence but the hope has not turned out to be fruitful.

It is worth noting that Walmart is selling the Bonobos brand to a brand management firm WHP Global and Express for just $75 million which is way below the price it paid for acquiring the brand in 2017. This means that the brand was really not working out for Walmart as they have decided to sell it at a huge loss. Talking about the Bononos brand, WHP Global will acquire the brand for $50 million and Express will get Bonobos’s operating assets and related liabilities for $25 million.

Express CEO, on the acquisition of Bonobos, said “Bonobos is delivering double-digit sales growth and we plan to continue that momentum while also realizing operating synergies and other economies of scale,”. He also added that “This is a compelling addition to our brand portfolio, and I expect the transaction will be accretive to operating income and free cash flow positive in fiscal 2023.”

Walmart said in a statement that it feels this is the right time to sell the Bonobos brand. The company added that “Bonobos joined the Walmart family to expand our assortment and expertise in Menswear. Since acquiring Bonobos, Walmart.com has grown from 70 million to hundreds of millions of items,”. It is worth noting that while Walmart is indeed selling the Bonobos brand for a definite loss, it could have still profited from the acquisition thanks to the growth of its own brand and not the Bonobos brand itself.

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