True Religion jeans brand acquired by PE firm with American Eagle investment links.

• After two bankruptcy filings, True Religion has new owners following its jeans company's comeback.
• The urban staple jeans brand popular in the hip hop community, which emerged during the Y2K era, was acquired by private equity firms ACON Investments and SB360 Capital Partners, chaired by American Eagle CEO Jay Schottenstein.
• In 2023, True Religion reported a 20% increase in sales to $280 million, resulting in $80 million in EBITDA, according to CNBC.

Acon Investments and SB360 Capital Partners, a retail investment fund led by American Eagle CEO Jay Schottenstein, have acquired jeans brand True Religion.

The jeans brand that was popular during the Y2K era has been revived under the leadership of CEO Michael Buckley and was put up for sale last year following its second bankruptcy in 2020.

In 2023, True Religion's sales grew 20% to $280 million and it brought in $80 million in EBITDA, CNBC previously reported. However, the terms of the transaction that led to the sale of the company were not disclosed.

"True Religion's partnership with ACON and SB360 is an exciting new chapter, as Buckley stated in a statement. With their expertise and resources, True Religion is positioned to enhance its digital and retail capabilities, accelerate its international growth, and continue innovating its apparel offering."

Acon, a retail investment firm based in Washington, D.C., has $7.2 billion in assets under management and has previously invested in popular consumer brands such as Applebee's, Igloo, Spirit Halloween, and Borden Dairy, according to its website. SB360, Acon's strategic partner, is part of chairman Schottenstein's network of companies, which includes American Eagle and DSW. The company invests equity capital to support growth opportunities.

The retailer, True Religion, has undergone a transformation from a struggling luxury brand to an urban staple, and has collaborated with hip-hop star Megan Thee Stallion for its 2024 holiday campaign.

The comeback of True Religion can be attributed to a marketing strategy led by Chief Marketing Officer Kristen D'Arcy, who has partnered with strategic influencers like Jayda Cheaves, a content creator with nearly 9 million followers on Instagram. Additionally, the brand has benefited from good timing, as jeans have recently become one of the hottest segments of the apparel sector and Y2K fashion has come back in style with younger shoppers, making brands like Ed Hardy and Von Dutch popular once again.

In 2002, True Religion was established, and its $300 jeans, featuring distinctive stitching and logos of a smiling Buddha and horseshoe, gained popularity among celebrities such as Jessica Simpson and Britney Spears. However, by the 2010s, the company's sales had slowed, and it lost favor with consumers, ultimately declaring bankruptcy in 2017.

True Religion emerged from bankruptcy twice, first in the past and then again in 2020 during the Covid pandemic.

In the 2000s, Buckley led the company. In 2019, he returned and focused on reducing costs and targeting a new consumer with an average income of $60,000 to $65,000. At the same time, the company's typical jeans price point decreased to under $100 a pair, making it more affordable for its target market and competitive with brands like Levi Strauss.

"To be successful, you must understand your target audience. The previous management, prior to my return, continued to market to their perceived customer from 2010. However, this approach resulted in the loss of the brand's following. Today, there are more followers than the initial group of early adopters who wanted the brand back then."

Buckley stated that True Religion could become a billion-dollar brand by increasing its product range, boosting online sales directly, and targeting more female customers.