Bain Capital has taken over control of Canada Goose on undisclosed conditions. It's an interesting move by Bain, the New York-based private equity firm that bought Jack Wolfskin from Johnson Outdoors in 2002 for €42 million and sold it for €93 million in 2005 to two other financial investors.
Canada Goose, which has become famous for its distinctive fur-trimmed parkas and down coats with red, white and blue arm patches, is widely distributed in both the sports and fashion circuits in about 50 countries around the world. Considering the valuation given to Moncler, which is positioned in a similarly high segment in the fashion market, observers speculate that it may be worth up to $900 million, or five to six times its estimated revenues in 2012.
Dani Reiss, the chief executive of the Canadian family-owned company, will retain a significant minority stake in the operation, which was founded by his grandfather in Toronto in 1957. Reiss, who was named Canada's Entrepreneur of the Year for 2011 by Ernst & Young, will remain as president and chief executive.
While its clothing is also made elsewhere, according to well-informed sources, Canada Goose is banking on its Canadian origins to promote the warmth of its outerwear. It announced last year a large expansion of its Canadian manufacturing, adding a factory in Winnipeg to its existing facilities in Winnipeg and Toronto to cope with its strong growth and high demand for its Canadian-made products.
Canaccord Geunity Corp., which was hired by Reiss last April to find a financial partner to bring new equity into the operation, served as financial advisor to Canada Goose in the takeover transaction, aided by Deloitte as accounting advisor and Torkin Manes as legal counsel. Bain was advised by Ropes & Gray, Stikeman Elliott, Loyens & Loeff Luxembourg, Maples & Calder and PricewaterhouseCoopers. CIBC provided some of the financing.