SHANGHAI, CHINA – DECEMBER 02: A citizen walks by a Canada Goose store on December 2, 2021 in Shanghai, China.
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Canada Goose’s controlling shareholder, Bain Capital, has received bids aimed at taking the luxury parka-maker private at a valuation of about $1.4 billion, according to people familiar with the matter.
Bain Capital is looking to offload its holding in Canada Goose, the people said, with Goldman Sachs advising on the sale. All existing offers aim to privatize the company listed in Toronto as well as New York, according sources who asked not to be named as the information is confidential.
Private equity firms Boyu Capital and Advent International have made verbal offers, valuing Canada Goose at eight times its 12-month average earnings before interest, taxes, depreciation and amortization, translating into a valuation of around $1.35 billion, the people said.
Other interested buyers include Bosideng International, a Shanghai-based maker of down jackets, and a consortium formed by private-equity firm FountainVest Capital and Anta Sports Product — the duo had led a deal in 2019 to acquire Finland’s Amer Sports, owner of Wilson tennis rackets.
The bid to take Canada Goose private is not surprising, according to several industry watchers, as going private would give buyers greater autonomy to turn around the company, without extra scrutiny of regular financial disclosures.
Bain Capital is holding off on a decision until more offers roll in, the people said, adding that once a buyer is selected, due diligence is expected to take less than two months before the deal is signed.
Canada Goose’s New York-listed shares have gained over 21% so far this year, lifting its market value to $1.18 billion. Though still a far cry from its 2018 peak of $7.7 billion, a year after it went public, the valuation represented outsized returns for Bain from the reported $250 million level when it took control in 2013.
As of March, Bain owned around 60.5% of its multiple voting shares, which carry 10 times the voting power of the company’s publicly traded stock, giving Bain 55.5% of total voting power at the firm, according to a regulatory filing.
A defining exit
Bain’s planned exit comes as Canada Goose has been struggling to sustain growth momentum in several key markets, with analysts questioning its brand positioning and marketing strategy at a time when consumers are becoming cautious about big-ticket apparel purchases.
For the year ended in March, the company’s revenue fell 1.1% on a constant currency basis from a year earlier to $1.35 billion Canadian dollars, as sales in its crucial markets including Canada, China and the EMEA region — comprising Europe, Middle East, Africa and Latin America — declined 2.4%, 1.7% and 12.1%, respectively.
That represented a sharp slowdown in its global revenue growth, which had risen 23.2% in 2022, 10.9% in 2023 and 9.6% in 2024 on a constant currency basis.
The sales decline in China — which hosts nearly half of the company’s global stores — signals a sharp downturn compared with a jump of 47% jump in sales in fiscal year 2024, when China overtook Canada as the company’s biggest market.
In the latest quarter ending in June, a seasonally slow period for the winter-coat maker, Canada Goose posted a bigger-than-expected net loss of CA$125.5 million, widening from a CA$74 million loss in the same period last year.
The exit also came as Bain’s 12-year control of Canada Goose has far exceeded the typical private-equity investment cycle of roughly five to 10 years, making an exit a natural next-step.
“Bain’s Canada Goose deal represents a classic PE fund cycle — acquiring the brand, taking it public and now looking to exit,” said an industry veteran who did not want to be named, adding that an exit after 12 years is far from ideal.
“The problem with Canada Goose is that it neither does functional wear particularly well nor fashion particularly well from the consumer perspective,” said Yaling Jiang, founder of consumer consultancy firm ApertureChina.
The company tends to settle for mid-tier brands and celebrities in their marketing, straying from its core strength in winterwear, Jiang added. “The brand feels rootless and faceless.”
She also pointed to inconsistency in Canada Goose’s messaging and actions: “It’s awkward when they bank on lifelong quality and then they face a number of quality scandals in China … and when they call themselves luxury fashion but many consumers expect to buy them at [mass market] outlets,” Jiang said.
Canada Goose has flagged that higher U.S. tariffs could raise raw material and compliance costs, potentially leading to price hikes that risk eroding the company’s competitiveness in some markets.
While withholding its current fiscal year’s forecast over uncertain trade environment, the company said it was in good shape to manage the impact of tariffs, as 75% of its items are made in Canada and are currently exempt from U.S. tariffs due to compliance with the United States-Mexico-Canada Agreement.
The outerwear maker is reportedly pushing into sweaters, sunglasses and footwear as it seeks to transform from being a parka specialist to an all-season brand with sustained sales during off-peak seasons.