Fashnopsis:
- Centric Brands Acquires Messi Brand License from MGO Global for $2 Million
- Transition Terms: MGO to Transfer Online Store Management and Assets to Centric
- New Ownership Sparks Expectations for Fresh Licensing Agreement
- Financial Performance: Sales Tripled, Share Prices Plummeted
- Challenges Unveiled: MGO Reports Significant Corporate Losses
The Messi brand has undergone a change in ownership, with Centric Brands acquiring the license from MGO Global for a sum of two million dollars. Launched by the renowned athlete in 2019, the brand initially partnered with the American company MGO, specializing in licensing management, co-founded and led by Virginia Hilfiger, sister of Tommy Hilfiger, alongside Maximiliano Ojeda.
As per the terms of the agreement, MGO will transfer the management of Messi’s online store, along with customer databases, design blueprints, and technical expertise, to Centric.
Centric Brands, headquartered in New York and spearheaded by Jason Rabin, boasts a portfolio comprising 150 brands. This acquisition is anticipated to prompt a fresh licensing arrangement, given that the existing agreement with MGO is set to expire in December.
In 2023, MGO was obligated to remit $1.6 million in rights to the Inter Miami star in November and allocate an additional $1.3 million towards corporate obligations.
In January 2023, MGO, listed on the US Stock Exchange, announced a threefold surge in sales subsequent to the brand’s introduction into the US market. However, share prices plummeted to $5, falling below the initial offer price of $16.61.
The magnitude of the issue surfaced recently when MGO filed its annual report with the Securities and Exchange Commission. The brand’s sales for 2023 totaled $1.69 million, bringing the cumulative revenue over the three-year period to $3.6 million.
Nevertheless, during those three years leading up to 2023, MGO disbursed slightly over $2 million to Messi in licensing fees, expended approximately $1.8 million on manufacturing and retailing apparel, and recorded corporate losses amounting to $11.4 million.
Image Credits: Modaes
