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Dec. 27 (NBD) – Hong Kong-based fashion retailer I.T Group and IDG Capital jointly announced minority investment in Swedish fashion brand Acne Studios on Saturday, after which the two investors will hold 10.9 percent and 30.1 percent of the luxury brand's shares, respectively.

I.T Group will have the right to name a member and a non-voting observer in the Board of Directors of Acne Studios to oversee the brand's performance and take part in strategic decision-making.

Acne Studios, a short name for Ambition to Create Novel Expression Studios, was established in 1996 in Stockholm, and has grown into a comprehensive brand that includes not only clothing and accessories, but also digital arts, visual design, space design and furniture. The brand distinguishes itself with simple design and clean cutting.

Co-founder Mikael Schiller once said in an interview that the expansion of Acne Studios relied solely on revenue growth, different from other brands which fervently woo capital or dedicated to scaling up to giant groups. "I hope every fashion house can decide its growing pace," said Mikael.

According to a report by Business of Fashion, Acne Studios achieved a compound annual growth rate of 27.6 percent during fiscal year 2013 to 2015, faster than brands like Moncler, Furla and Michael Kors.

The balance between independence and commercial value, however, is becoming increasingly difficult for Acne Studios to sustain. As relevant financial reports show, though Acne Studios doubled its sales from 2013 to 2016, the momentum has been waning. The growth of sales and net profit slowed down significantly in 2017.

In March this year, Acne Studios was reported to have commissioned Goldman Sachs to seek potential buyer, and had received multiple tender offers from private equity frims, global luxury conglomerate and China's Fosun International and Shandong Ruyi Technology Group.

I.T, which finally inked the deal, currently distributes over 300 international brands. The mutually supplementary cooperation with I.T is among the most rational choice for Acne Studios if the latter is to maintain a high level of control over clothing quality and independent design.

Independent brands can have firm control over brand image and design of ready-to-wear collection, but it is hard for them to compete with more commonly known brands in the ear of fast fashion. Being acquired by consortium or receiving investment from industry giants has become inevitable for many independent brands.

In August this year, Italian menswear giant Ermenegildo Zegna acquired a 85 percent stake in acclaimed New York designer brand Thom Browne. Dries Van Noten, a much admired Belgium brand, sold a majority of its shares to Spanish luxury group Puig, and no longer had absolute control of the brand and design. 

Email: limenglin@nbd.com.cn