Acon Investments has announced closing a single-asset continuation round worth around $700 million to increase its stake in the New Era headwear brand while bringing in new backers.
The Washington, D.C.-based private equity firm will manage the fund, with new investors including Apollo, GCM Grosvenor, Hamilton Lane, and Neuberger Berman. The National Football League (NFL), Major League Baseball (MLB) and National Basketball Association (NBA), all of which have partnerships with New Era, have become minority stakeholders in the Buffalo-based company.
Acon’s initial investment in January 2021 represented the company’s first and only institutional equity capital.
New Era continues to implement a multi-pronged growth strategy, further expanding its more than 800 retail store footprint throughout Asia, Mexico, Latin America, and Brazil and growing its core lifestyle brand in apparel and its DTC platform.
New Era Cap will continue to be led by Chris Koch, its fourth-generation CEO, whose great grandfather, Ehrhardt Koch, founded the company in 1920 in Buffalo, NY.
The 102-year-old brand has experienced several years of record organic revenue growth, which is expected to continue for the foreseeable future.
Ken Brotman, Founding Partner of Acon Investments, commented, “New Era Cap represents a unique and proprietary opportunity in which Acon served as an early partner for the company and the first institutional equity capital for this 102-year-old iconic brand. We are humbled to be the company’s trusted partner and have great respect for New Era Cap’s long and rich history and what Chris Koch and the management team have built. It has been one of our best performing portfolio investments in ACON Equity Partners IV, and we are excited to continue our partnership with Chris and the team to drive further growth and expansion around the globe.”
Chris Koch, CEO, New Era Cap, stated, “We are thrilled to expand our relationship with Acon and lean on their vast experience in the lifestyle and consumer products sector. Their proven track record of supporting companies through growth and expansion made ACON the perfect partner for our business. This new capital will facilitate the acceleration of our aggressive growth initiatives and allow us to consider potential North American and global acquisitions that may be additive to our already powerful global platform.”
As part of the transaction, the MLB, the NFL and the NBA will become minority owners in New Era Cap.
Jim Grundtisch, Chief Revenue Officer of New Era Cap, remarked, “Having our three largest league partners aligned with us through a strategic equity position further solidifies our already strong partnerships. We are committed to continuing on the robust global growth trajectory we have set for our brand and for our key global partners well into the future.”
Acon was represented in the transaction by Evercore. Jefferies LLC also acted as a financial advisor to Acon, while Winston & Strawn served as Acon’s legal advisor. Truist Securities acted as exclusive financial advisor and Bryan Cave Leighton Paisner served as legal advisor to New Era Cap.
Photo courtesy New Era