Online sports retailer Fanatics has teamed up with a host of celebrities, including Jay-Z, Meek Mill, and Maverick Carter to buy the nostalgic sports brand Mitchell & Ness. The deal valued Mitchell & Ness at about $250 million.
Mitchell & Ness made about $70 million in profit off approximately $350 million in revenue last year, according to reports.
Fanatics will own 75 percent of Mitchell & Ness and the other 25 percent will be owned by the celebrity cohort. Kevin Wulff, the CEO of Mitchell & Ness, will stay on, as will all 132 employees.
If you’re a sports fan you know Mitchell & Ness and their authentic throwback jerseys and apparel. It makes sense for Fanatics to purchase the company, as they are a high-revenue online sports retail company. Fanatics is valued at $18 billion and owns the rights to fan gear for major U.S. sports teams.
In 1904 Frank Mitchell and Charles Ness met up in Philadelphia to establish Mitchell & Ness Sporting Goods and started making uniforms for local Philly baseball and football teams.
In 1985 a customer request to repair his game-worn 1960 Pittsburgh Pirates vest and his game-worn 1949 St. Louis Browns jersey led to the company deciding to craft authentic and historically accurate jerseys and apparel.
Mitchell & Ness’ throwbacks sell for $100 to $400, and the company has licensing deals with the NBA, NFL, MLB, MLS and several NCAA universities.
Jay-Z, who refers to himself as “an early adopter” of Mitchell & Ness, described in a statement what the acquisition means to him:
“Proud to play a small role in bringing it back and, in some cases, introducing the authenticity and quality of the Mitchell & Ness brand to a new generation.”
Jay-Z is already in business with Fanatics and chairman Michael Rubin on a sports betting division. The legalization of online sports gambling across the country is a gigantic revenue source. Having access to all things sports under a company’s umbrella has the potential to drive significant revenue.
The purchase of Mitchell & Ness by Fanatics follows the trend of other nostalgia brands that have brought in new ownership with plans to revive and refresh the old brand. Reebok was recently purchased by Authentic Brands Group for $2.5 billion.
It will be interesting to see what kind of marketing Fanatics will do to drive more interest around Mitchell & Ness and what offerings they might be able to expand into.
NASCAR Winston Cup Series jackets were popular for a run in the ’90s. Would fans like to see those return? NHL throwbacks?
Since Fanatics and Jay-Z are looking at a sports betting division, what about NFTs? Non-fungible tokens are all the rage as we move towards the metaverse. Would throwbacks as NFTs be something that gets added to the portfolio?
Fanatics is in acquisition mode, as they acquired Topps trading cards in January in a deal reportedly worth $500 million.
If you’re keeping score, Fanatics would have under one umbrella: trading cards/memorabilia, sports apparel, potentially online gambling, and NFTs. That’s a pretty powerful company.
This is all a very clear strategic plan by Rubin and Fanatics to become the preeminent digital sports platform.
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