Gap Inc. has agreed to acquire Athleta Inc., the womens sports and active apparel catalog company based in Petaluma, CA, for about $150 million in cash. The Gap said the acquisition will allow it to enhance its presence in the growing $31 billion womens active apparel sector in the United States.
Following the acquisition, Athleta, which has achieved rapid growth and profitability in recent years, will become the “fifth tab” on Gap Inc.s unique online platform, called Universality. The innovative technology allows shoppers to browse and buy from all of the companys brands in one shopping cart with a single shipping fee. Athletas products will be ultimately sold online alongside those from Gap, Banana Republic, Old Navy and Piperlime.
“Athleta is a great success story with loyal customers that will now become part of the Gap Inc. family of brands,” said Glenn Murphy, Gap Inc.s chairman and CEO. “This strategic acquisition complements our brands perfectly and allows us to leverage our new online platform to expand into this significant retail sector.”
Founded 10 years ago, Athleta has evolved into a premier lifestyle brand, offering high quality apparel that is stylish and functional for a variety of sports, including yoga, running, skiing, snowboarding and surfing. About 90% of its products is proprietary branded, across a wide variety of sports and fitness activities, including a high component of crossover apparel as well as casual wear. Customers can purchase Athleta product online or through the companys catalog. The company is headquartered in Petaluma, CA and has 250 employees.
“Were thrilled to become part of this great company and to have found a partner that supports our vision for Athleta,” said Joe Teno, the current CEO of Athleta who will remain as president of Athleta at Gap Inc. upon the completion of the deal. “With Gap Inc.s e-commerce platform and iconic brands, more customers will learn about Athleta as we continue to provide our existing customers with the great products and service theyve come to expect from us.”
Teno will report to Toby Lenk, the president of the Gap Inc. Direct division.
The acquisition is subject to certain customary closing conditions.
In January 2006, Blue Highways Holdings LLC, a company managed by Bruce Willard, acquired a majority interest in the Company. Willard said of the deal,, “We are delighted to be selling Athleta to The Gap. They will provide the backing of one of the countrys pre-eminent clothing brands and they will bring enormous resources to help Athleta grow from here.”
