Toys R Us Parent WHP Takes 7% Stake in Express

Fashion retailer Express has turned to WHP Global as it begins a “large-scale transformation.”

WHP, a brand turnaround firm that owns a number of companies, including Toys R Us, will take a 7.4% stake in Express, the retailer announced Thursday (Dec. 8).

Express CEO Tim Baxter said the partnership was part of a “large-scale transformation” that would allow Express to boost “growth by acquiring multiple brands..and operating them on our platform.”

Based in New York, WHP owns and manages brands with a combined $4.5 billion in retail sales, focused on those with “legacy character traits,” as the company website says.

In addition to Toys R Us and its sister company Babies R Us, it also owns Anne Klein, Isaac Mizrahi, Joseph Abboud, Lotto, Joe’s Jeans, and William Rast.

WHP stepped in to assist Toys R last year after the chain closed its last two stores in the U.S., opening a new store at the American Dream Mall in New Jersey. The toy retailer has since branched out even further, opening locations inside Macy’s stores around the country.

The company’s investment in Express comes in two parts, the first being $25 million from WHP to acquire 5.4 million shares in Express, giving it a 7.4% stake in the company, which owns 550 stores in addition to its eCommerce operations.

The two entities will also form a $400 million “intellectual property joint venture,” with WHP investing $235 million for a 60% ownership.

The WHP/Express partnership news came the same day Express released quarterly earnings figures that showed an 8% decline in comparable sales.

“The third quarter was tougher than we anticipated and that is reflected in our results,” Baxter said in the earnings report. “The macroeconomic, consumer, and competitive environments were extremely challenging, and became more acute as the quarter progressed.”

According to the release, Express saw eCommerce demand decline by 17% during the quarter. Earlier this year, the company said it was confident it would hit its goal of $1 billion in eCommerce demand by 2024, as that demand rose 33% versus 2020 and 21% versus 2019.