Details Of Wacoal’s Acquisition of Lively

In a surprising move, Wacoal International Corporation, parent company of Wacoal America, Inc., acquired at the end of July the Lively lingerie brand for $85 million plus additional earnouts based on future performance.

The label was founded in 2015 by Michelle Cordeiro Grant, a former Victoria’s Secret executive, with the early backing of Gelmart International.

Lively, under its corporate name, Intimates Online, Inc., lost $3.728 million on sales of $11.490 million in the year ended December 2018, following a loss of $1.631 million on sales of $5.315 the year before.

One of a host of so called digitally native, all inclusive lingerie brands, Lively “prides itself on the vast community of over 80,000 ambassadors” that Grant “built through social networking services and digital media marketing methods,” according to a statement from Wacoal. MMG Advisors Inc. recommended the acquisition to its Japan-based client.

Declared Bob Vitale, president and CEO of Wacoal America, “The Lively brand has worldwide business potential that may be achieved with Wacoal corporate support globally. As one of the digitally native brands that are positively disrupting the U.S. intimates’ business, Lively has quickly established an incredible following. Our collaboration with Lively will no doubt result in dramatic sales growth and market share gains in the Americas, enabling both brands to engage and win the important millennial customer, and market more effectively in the evolving digital world.”

Currently Lively offers a wide selection of intimates including bras, underwear, swimwear, loungewear and bodysuits. Prices are moderate, with bras selling for $35; panties for $10; swim suits for $45 and $65; and items such as a lounge shirt or pants for $45 each.

Based on the average $35 bra price, Lively’s $11.490 million in 2018 sales would amount to 328,286 bras. Or $143.63 per ambassador.

On its website, Lively provides a simple application inviting consumers to become its ambassadors. “Fill out a few quick questions and you’ll be on your way!” reads the form which requires only the applicant’s first name, email address, Instagram account and phone number. “Become a Lively ambassador and join this movement of wild hearts and boss brains!” exudes the website, adding in a footnote, “By joining via text, you agree to receive recurring automated marketing messages from Lively at the cell number used to send the Join text,” and that “Msg & data rates may apply.”

In addition to its internet business, Lively has two stores, one in New York, the other in Chicago. But a Wacoal investor filing notes that the company “uses its e-commerce website as its main distribution channel” for sales in the U.S.

In addition to the initial payment of $85 million, Wacoal will pay an additional amount to the sellers which will range between $20 million and $55 million in total, based on performance over the next four years. The exact amount will be “based on Intimates Online’s business results such as net sales.” Wacoal noted in the investor filing that “the introduction of earn-out consideration will reduce our risk associated with this acquisition.”

Leading up to the Wacoal acquisition, Lively had “raised $15 million in venture capital funding, including a $6.5 million Series A investment from GGV Capital, NF Ventures (Gelmart International), and former Nautica CEO Harvey Sanders,” according to Wacoal. — NM