A law firm announced on November 7, 2025 that it is investigating Guess, Inc.’s board and executive officers for possible breaches of fiduciary duties related to the company’s pending sale to Authentic Brands Group (ABG). The investigation focuses on whether the board and executives acted in the best interests of shareholders during the negotiation and rollover of ownership by key Marciano family members.
The transaction values Guess, Inc. at approximately $1.4 billion, including debt, and will pay shareholders $16.75 in cash per share. The price represents a 73 % premium to Guess’s closing price on March 14, 2025 and a 26 % premium to the price on August 19, 2025. ABG will acquire a 51 % stake in Guess’s intellectual‑property holding company, while the Marciano family and other existing shareholders will retain the remaining 49 % of the IP holding company and 100 % of the operating company. The deal is expected to close in the fourth quarter of Guess’s 2026 fiscal year.
The investigation, led by Bleichmar Fonti & Auld LLP and joined by DJS Law Group, will examine the negotiation process and the rollover of ownership by the Marciano family. If misconduct is found, the deal could be delayed, renegotiated, or subject to legal penalties, potentially affecting the transaction’s timing and value. The inquiry underscores the importance of fiduciary oversight in high‑value M&A transactions.
Financially, Guess reported Q3 fiscal 2025 revenue of $739 million, up 13 % from $664.5 million in Q2 fiscal 2025, driven largely by the Rag & Bone acquisition and modest growth in core Guess businesses. GAAP net loss widened to $23.4 million from a $10.6 million loss in the prior quarter, while adjusted net earnings fell 35 % to $17.7 million from $27.0 million. GAAP operating margin contracted to 5.7 % from 6.5 % in Q2, reflecting higher cost of goods sold and integration expenses. In Q2 fiscal 2024, revenue was $664.5 million with a GAAP net profit of $39 million and an operating margin of 9.7 %—a stark contrast to the current quarter’s losses.
CEO Carlos Alberini said the revenue growth was largely driven by the Rag & Bone acquisition and modest gains in core Guess segments, noting that Europe performed strongly while North America and Asia faced slower customer traffic. Co‑founder and Chief Creative Officer Paul Marciano highlighted significant investments in new product introductions and marketing campaigns, emphasizing positive customer response and the importance of brand revitalization.
Investors reacted to the August 20 announcement of the deal with enthusiasm, driven by the substantial premium and the strategic partnership that would allow ABG to leverage its global brand platform. The November 7 investigation announcement has tempered that optimism, as market participants now weigh the potential for delays, renegotiation, or legal penalties that could erode the transaction’s value.
The investigation’s outcome will be closely watched, as it could alter the closing timeline, affect the premium paid, and influence the future governance structure of Guess. The company’s ability to navigate this scrutiny will be critical to maintaining shareholder confidence and ensuring a smooth transition to private ownership under ABG’s stewardship.
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