Walmart sold Bonobos for $75M, $235M less than it paid six years earlier

Walmart agreed in April 2023 to sell its Bonobos menswear line to WHP Global and Express Inc. for $75 million, $235 million less than it paid for the business in 2017. WHP would pay $50 million for the Bonobos brand, and Express, partly owned by WHP, would pay $25 million for the operating assets and related liabilities. Walmart said Bonobos had joined the family to expand its menswear assortment and that, after nearly six years, it was 'the right time to sell'.

Fortune put the deal on a list of Walmart fashion flops: the company has a record of acquiring apparel businesses only to sell or shut them later. It sold ModCloth in 2019, Shoes.com and Bare Necessities in 2020, and agreed in February 2023 to sell Moosejaw, bought in 2017 for about $51 million, to Dick's Sporting Goods. The Bonobos purchase came during Marc Lore's push, after Walmart bought Jet.com for $3.3 billion, to elevate Walmart.com with digital-native brands. Bonobos founder Andy Dunn initially oversaw it and left Walmart in 2019.

Walmart had stumbled in apparel before, Fortune noted: in 2010 it vowed to go 'back to basics' after an upscale push failed, then closed its New York apparel office a year later. The buyers said Bonobos was delivering double-digit sales growth; Express shares jumped as much as 25% on the news, and Walmart's stock was little changed.

A $75M sale price, $235M below the 2017 purchase price; Walmart had earlier sold ModCloth, Shoes.com and Bare Necessities, and sold Moosejaw in February 2023.

Walmart bought Bonobos in 2017 as part of an e-commerce push led by Jet.com founder Marc Lore, not from a core apparel strength.

The brand's founder left in 2019 and the acquisition did not turn into a lasting fashion business inside Walmart.

Walmart has repeatedly struggled to sell apparel beyond basics, and shed ModCloth, Shoes.com, Bare Necessities and Moosejaw.

Marc Lore left, and Fortune pointed to Walmart+ and a third-party marketplace, not owned fashion brands, as the e-commerce drivers now.

Buying digital-native brands to import e-commerce credibility only works if the parent can run them; Walmart repeatedly bought apparel and then sold it at a loss.

The deal was expected to close in summer 2023, with Bonobos head John Hutchison staying on as brand president under Express CEO Tim Baxter. Walmart said it was not abandoning apparel and pointed to Brandon Maxwell, Joyspun and Eloquii.