Vans shoe maker VF is paying $2.1 billion to buy Supreme- the streetwear apparel company with the cult-like following. Private equity firms Carlyle Group and Goode Partners are selling their stakes in the company behind the cool brand.
The perceived scarcity of Supreme’s products ranging from hoodies to burner phones has made them extremely popular among the young streetwear fans known as “hypebeasts,” and that gives the company pricing power that juices up its profit margins. Known for its red box logo, its products sell out in minutes after their launch, and people wait in line for hours outside its 12 stores worldwide. Founded in 1994 in downtown Manhattan, Supreme became the home of New York City’s skate culture.
Many of its fans snap up Supreme’s clothing online; that sales channel accounts for more than three-fifths of its revenue. VF, which also owns brands such as The North Face and Timberland, hopes the deal will bolster its e-commerce business.