True Religion Acquired by American Eagle CEO-Chaired Investment Firm

California premium denim label True Religion has been acquired by a pair of investors aiming to put the Y2K favorite on track for a true comeback.

Washington, D.C.-based private equity firm ACON Investments, L.L.C. and strategic partner SB360 Capital Partners, a retail investment firm led by American Eagle CEO Jay Schottenstein, on Tuesday announced that they acquired a controlling stake in the lifestyle label. The terms of the transaction weren’t disclosed.

The investors said the deal would allow them to leverage their combined resources to fuel the brand’s growth and reach while broadening product offerings.

An essential denim player in the early aughts, True Religion has enjoyed a burst of renewed interest in recent years as young shoppers driven by nostalgia mine history for sartorial inspiration.

A new generation of tastemakers has also teamed with the brand in recent years; recording artist Saweetie released a collection of denim staples with True Religion in early 2024, while Chief Keef, who rapped about the song in his 2012 hit “True Religion Fein” has been a consistent collaborator. In 2021, streetwear leader Supreme also worked with the label on a collection of denim jackets, hoodies, cargo pants and caps, all featuring the brand’s signature stitching and Buddha motif.

While these hype-worthy projects have led to recent success at retail (sales grew by 20 percent in 2023, bringing in $80 million in EBITDA), True Religion’s commercial viability has been shaky in recent years. The company exited its second Chapter 11 bankruptcy in October 2020 after first filing in 2017. Counting Second Avenue Capital Partners, a Schottenstein affiliate, along with TCW Private Credit and Sagard Credit, provided the brand with a new credit facility in August 2023, allowing it to refinance debt and support fund working capital needs.

CEO Michael Buckley returned to the helm in 2019, and has attempted to solidify the brand’s future through a forward-looking marketing and retail strategy.

“Our partnership with ACON and SB360 represents an exciting new chapter for True Religion. 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,” Buckley said this week. “We look forward to working together as we bring True Religion’s bold, authentic style to even more consumers around the world.”

ACON founding partner Ken Brotman said the investment firm was “thrilled” to bring True Religion into its portfolio, while the firm’s managing partner, Suma Kulkarni, said, “True Religion has built a unique and powerful brand with a loyal customer base and a deep connection to its core values of authenticity, quality and self-expression. Our partnership with SB360 will provide valuable additional resources essential to unlocking the Company’s full potential.”

SB360 president Aaron Miller said the retail investment firm was “excited to collaborate with the talented team at True Religion, an iconic brand with a rich heritage.” The Schottenstein family of companies includes DSW, Designer Brands, American Eagle and Aerie, and SB360 has invested in retailers like JCPenney and Sears.

“We seek out brands with a strong core identity and a passion for leading a market segment. The growth since 2020 is unprecedented and by leveraging our expertise in retail, we are confident we can help the Company to continue to thrive,” Miller said. “Our investment reflects our belief in the Company’s growth potential and continued innovation in the fashion industry.”

The brand will continue to operate independently and maintain its headquarters in Gardena, Calif., and will explore opportunities to collaborate with the brands and retailers within ACON and SB360’s portfolios.