French luxury label giant LVMH Group, owner of Louis Vuitton and Bulgari, has put its faith in an Australian brand.
The global giant has tipped its hat to Australian sportswear retail chain 2XU via a significant minority investment to fuel its growth.
2XU confirmed today that 2XU and Lazard Australia Private Equity Pty Ltd (Lazard Private Equity) have entered into a new partnership with L Capital Asia 2 (L Capital Asia). L Capital Asia 2 (L Capital Asia) is a private equity fund sponsored by LVMH Moët Hennessy Louis Vuitton S.A. (LVMH), Groupe Arnault and YTL Corporation Berhard.
Founded in Melbourne in 2005, 2XU has experienced significant growth over the past five years, including a reported revenue rise of more than 40 per cent a year per annum. To date, the brand also has a global distribution network covering more than 50 countries.
Despite describing 2XU as “one of Australia’s most innovative companies, using cutting-edge fabrics and technology developed to enhance sports performance and recovery”, 2XU management said that the company is still in the infancy of its growth potential.
As part of the next phase of growth, 2XU and Lazard Private Equity selected L Capital Asia as an equity partner with a shared vision. L Capital Asia will be able to provide 2XU with a valuable consumer markets understanding and access to global markets, through their extensive network and the LVMH Group.
Commenting on the coup, 2XU executive chairman and co-founder Clyde Davenport said the tie-up is set to take the local brand to new heights.
“We are thrilled to have L Capital Asia as a partner. We believe that its experienced international team will accelerate us towards our goal of becoming Australia's first major global sportswear brand.”
Lazard private equity director Gareth Young added that the partnership will help the brand achieve its global growth goals.
“Lazard Private Equity has enjoyed a successful partnership with 2XU since 2011 during which time the business has doubled its turnover, profit and been highly cash generative. This transaction delivers to our Fund 2 investors a money multiple return and IRR in excess of 2x and 50% respectively. We selected L Capital Asia as a like-minded and value-adding partner which can strengthen 2XU’s global growth plan.”