Jeans brand True Religion acquired by PE firm, American Eagle-linked investment group

Jeans brand True Religion has been acquired by private equity firm Acon Investments and American Eagle-linked firm SB360 Capital Partners – a retail investment fund chaired by the retailer’s CEO, Jay Schottenstein, CNBC has learned. 

The Y2K-era jeans brand has been making a comeback under company veteran and CEO Michael Buckley and went up for sale last year after emerging from its second bankruptcy in 2020. 

The terms of the transaction weren’t disclosed. Last year, the company was expected to sell at a mid-single-digit multiple of its earnings before interest, taxes, depreciation and amortization. In 2023, True Religion’s sales grew 20% to $280 million and it brought in $80 million in EBITDA, CNBC previously reported.

“Our partnership with ACON and SB360 represents an exciting new chapter for True Religion,” Buckley said in a statement. “With their expertise and resources, we are poised to enhance our digital and retail capabilities, accelerate our international growth and continue innovating our apparel offering.” 

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

True Religion gets a new home after the retailer transformed from a broken-down brand clinging to its luxury roots to an urban staple that has collaborated with hip-hop stars like Megan Thee Stallion, who was the face of the retailer’s 2024 holiday campaign. 

The comeback has been rooted in a marketing strategy led by Chief Marketing Officer Kristen D’Arcy, who has focused on partnering with strategic influencers like Jayda Cheaves, a content creator with nearly 9 million followers on Instagram. True Religion has also benefited from some good timing, which can be critical to a fashion brand’s success. 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, too.

True Religion was founded in 2002, and its $300 jeans, known for their signature stitching and smiling Buddha and horseshoe logos, were a favorite among A-listers like Jessica Simpson and Britney Spears. However, by the 2010s, the company’s momentum had lost steam and it had fallen out of favor with consumers, leaving it bankrupt by 2017.

True Religion eventually emerged from that bankruptcy and did so again in 2020 after it filed for a second time at the height of the Covid pandemic. 

Buckley, who helmed the company in the 2000s, came back in 2019 and worked to cut back expenses and dial in on a new consumer, which tends to be more diverse with an average income of about $60,000 to $65,000. At the same time, its typical price point for jeans has come down to less than $100 a pair, which is more accessible to its target customer base and in line with competitors like Levi Strauss. 

“You have to know who your consumer is. The previous management, before I came back, was still trying to market to who they thought that customer was in 2010,” Buckley told CNBC in an interview last year. “Like, they left the brand. There’s a lot more followers out there [today] than there is, you know, call it the early adopters that wanted this brand back then.” 

At the time, Buckley said True Religion has the potential to be a billion-dollar brand. To get there, the company has been working to expand its assortment, drive direct sales online rather than through wholesalers and reach more women.