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Tom Ford's sale begs question of timing

Kimberly Chin
Jul 8, 2022
Tom Ford walks the runway at a Tom Ford show.
Founder Tom Ford walks the runway at a Tom Ford show. Photo: Stefanie Keenan/Getty Images

Luxury brand Tom Ford's potential sale bid faces one tough question—timing.

Why it matters: While affluent shoppers haven’t shown signs of dialing back their spending, it remains to be seen whether the current dealmaking market has the appetite for a luxury brand transaction.

Driving the news: Founded by the former creative director of Gucci, Tom Ford has tapped Goldman Sachs to help it with its effort, Bloomberg reports.

State of play: Active deals keep falling by the wayside.

  • Last month, Authentic Brands Group pulled its bid to buy Ted Baker, months after the London-based fashion chain launched a formal auction process to field multiple takeover offers.
  • Department store chain Kohl’s pulled the plug on its sales process, citing the bleak retail environment and market volatility.

What they're saying: “The luxury market has experienced a dramatic democratization over the past two years, as consumer spending shifted from services and activities to goods while the world was locked down. This drove a significant increase in luxury goods spending and luxury consumers,” Cowen analyst Oliver Chen said in a note last week.

  • But, he adds, “Now that travel has resumed for many and more activities are available, the aspirational luxury consumer is facing more decisions with wallet share.”

💭 Our thought bubble: Consumer habits really are changing along with the markets, inflation and the reopening of the economy as people seek a return to normal. This may begin to seep into the luxury market too.

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