A Tech-style IPO for Yoga Pants?

01 May 2007

Just reading CBC.ca and noticed this gem.

Looks like athletic company Lululemon Athletica is planning a $200 million IPO. Goldman, Sachs & Co. and Merrill Lynch & Co. are involved. Couldn’t help but remind me of the various dot com IPO’s of the late nineties. Difference here, Lululemon is a powerful brand with real revenues that has cornered the market in womens athletic wear. Plus, I doubt the valuation is nearly as high.

Not sure what or who Lululemon is?

Walk into any gym and there’s a good chance that those spandexy-type pants and shirts (w/ the little upside-down U logo) all the women are wearing are Lululemon. If you’ve got a daughter, she’ll fill you in more. It started out as Yoga wear but I’d bet that most people wearing the brand nowadays have never stepped into a studio.

It’s an interesting phenomenon that’s spread like wildfire over the past 5 years. They do have a men’s line but it’s not high on my list of thngs to get. Give me a Nike sweatshirt and I’m good. My girl friend’s closet is a different story.

Either way, good on them for being a local company (they started in Vancouver, BC) shooting high and hitting the big time.

I laughed at this comment from one of the various press releases about the offering:

The move is not altogether surprising. In 2005, Chip Wilson, Lululemon’s founder and head designer, sold 48 per cent of the Vancouver-based company to two U.S. private equity firms, Advent International Corp. and Highland Capital, for $108 million. Lululemon’s proprietary ‘Luon’ fabric holds up under exercise stress and ‘women are convinced that it makes their butts look better,’ said an analyst commenting on the yogawear retailer’s success.