Sequential made a game-changing transaction in June 2014 by acquiring Galaxy Brand Holdings from Carlyle and Blackstone for $100 million in cash, 13.75 million shares of its common stock, and some additional warrants. The transaction positioned Sequential as one of the largest pure-play brand licensing companies in the world. It also gave it a couple of strategic partners in two of the biggest private equity firms in the world.
This should be a critical partnership going forward. Carlyle and Blackstone have good insight to major retailers looking to spin off underperforming or no longer strategic brands. Both firms now have a vested interest in its share holdings of seeing Sequential succeed given its stake in the company and could be an important source of financing for accretive deals in the future.
Just in April, Sequential acquired a majority interest in the Jessica Simpson brand, which has annual retail sales of approximately $1 billion and is seeing growth in the low teens. Soon after, the company announced it has entered into a long-term partnership with leading entertainment and lifestyle retailer HSN to present a selection of the best branded collectible and memorabilia products that The Franklin Mint will offer to consumers. This deal should continue to boost sales in one of Sequential’s core brands significantly.
The company then made its biggest acquisition ever this summer when it agreed to buy Martha Stewart Living Omnimedia (NYSE: MSO) which should start to be accretive to earnings this year as the deal has completed and is integrating into the company’s business model and processes.
Finally, the company acquired Joe’s Jeans for under $70 million in early September of 2015 which will add to the apparel and footwear brands it manages. Over the course of 2015, Sequential doubled their scale from $2 billion to $4 billion in global retail equivalent sales with the acquisition of four premier consumer brands in Jessica Simpson, Joe's Jeans, Emeril Lagasse and Martha Stewart.