The private equity firm Blackstone has bought a majority part of Spanx. This pioneering company makes shapewear led by one of the wealthiest woman-made, Sara Blakely, in an agreement that puts the value of the business to $1.2 billion, even though Forbes recently reported that it was worth a lot less.
The Spanx founder is expected to retain the “significant stake” in the brand that she launched in 2000. She will be named the executive chair once the deal is concluded, as per an article in the release from Blackstone. Blakely collaborated alongside an all-women group at Blackstone in the signing of the agreement, which was led by the Managing Director Ann Chung, who said Blackstone was drawn to the brand’s shapewear line due to its online sales as well as the technology used to create its products, and the potential for growth by leveraging better marketing in The Wall Street Journal.
$540 million. This is the amount Forbes estimates Spanx was worth at the end of June after it was disclosed that the company was looking to make a deal that could fetch more than $1 billion.
Blakely began Spanx by making money as a door-to-door fax machine salesperson. The idea came to her when she had to cover her pants while wearing white pants. In 2012, it was piling revenues in the range of $250,000, leading Blakely into Forbes the list of billionaires. However, the competition has increased since the rise of trendy and modern brands such as HoneyLove and Kim Kardashian West’s Skim’s and sources inside the firm who have been secretive about its financials, reported its sales for the previous year were down to 300 million-$400 million. This is less than the analysts’ estimates of the company’s 2015 sales. The epidemic didn’t help as sales of clothes for shapewear fell 24% between July 2019 through July 2020, as per NPD Group, without events to attend (and expensive clothes to slip in) and the necessity to work. Blakely’s net worth suffered a blow too. In August, Forbes said she had a net worth of $750 million. Blackstone has recently made investments in several other female-owned businesses such as Bumble and the Reese witherspoon-owned Hello Sunshine.