Yet another sign that socks are amongst the most trending and valuable accessories in fashion right now: The London-based private equity firm Palamon Capital Partners has acquired a majority stake in Swedish socks and underwear brand Happy Socks. Palamon bought out Happy Socks’ previous majority owner Scope for SEK 725 million (ca. €76.3 million), which is 4.7 times the amount that Scope invested in the company back in 2015. Additionally, Palamon injected SEK 40 million of growth capital in the brand to support its continued expansion.
The Happy Socks founders Mikael Söderlindh and Viktor Tell shall remain actively involved in the company following the transaction.
“When Scope invested in Happy Socks the focus was on making the business model robust and truly scalable, and the organization has responded better than expected to the measures taken. The next step will require a number of strategic choices to be made that will have a major impact on the direction of the company and we see that the brand can benefit from additional muscle”, said Fredrik Oweson, partner at Scope Capital Advisory SA.
Söderlindh and Tell founded Happy Socks in 2008 and disrupted the global sock wear market by offering attractively priced, colorfully patterned socks in a fashion context and promoting celebrity collaboration and a strong social media presence. Happy Socks are today sold in more than 90 countries, through more than 10,000 points-of-sale and own retail stores, generating retail sales of €100 million in 2016.
“In the last two years Happy Socks has grown beyond our expectations. We have transformed the company into a real growth engine by strengthening our operational platform and our global presence. We have achieved the best of both worlds by securing a strong new partner in Palamon and remaining significant owners in a great business that we will continue to build in the years to come”, said Söderlindh.
But the Swedish entrepreneurs are not only focusing on their socks company these days, instead they are busy with the launch of a new concept, The Cords & Co.
The Cords & Co. is a new fashion brand of corduroy-only apparel that most recently exhibited its first collection at Pitti Uomo, Seek Berlin and MAN Paris (with showcases at Project NY, CIFF Copenhagen, Project Las Vegas, Coterie NY and WOMAN Paris to come). The brand will kick off with a distribution in 15+ countries and plans to open six mono-brand concept stores in Los Angeles, New York, London, Paris, Stockholm and Tokyo in August of this year.
Palamon Captial’s previous investments in the specialty retail sector include: German discount designer fashion retailer dress-for-less, feelunique.com, a pure-play online retailer of premium beauty products in the UK; Italian leather goods brand Il Bisonte, and The Rug Company, a global brand in luxury handmade rugs.