Information on the Target

Hybrid Apparel has successfully completed its acquisition of Air Waves, a prominent provider of design and technology-driven print-on-demand (POD) services catering to e-commerce and wholesale clients. Following the acquisition, Air Waves will maintain its operations in Columbus, Ohio, where it will continue to offer its POD and technology services to Hybrid’s retail customers, as well as global licensing and lifestyle brand partners. With a robust reputation, Air Waves stands out in the market for its advanced capabilities in garment printing and fulfillment.

Founded in 1981, Air Waves initially started as a contract screen printer but has since evolved into a leader in e-commerce, characterized by its modern POD services, cutting-edge design capabilities, and advanced technology integrations. Notably, Air Waves provides a Shopify App—Air Waves: Print on Demand—which offers a complete apparel solution tailored for content creators and social media influencers.

Industry Overview in the United States

The print-on-demand industry has witnessed remarkable growth in the United States, bolstered by the increasing demand for personalized products and rapid advancements in e-commerce technology. Consumers are increasingly gravitating towards customized apparel, driving the need for flexible, scalable solutions that POD services provide. The need for quick turnaround times and high-quality production has further cemented the importance of companies like Air Waves within this sector.

As online retail continues to expand, so too does the demand for integrated fulfillment services that align with e-commerce platforms. This trend highlights the growing value of efficient supply chain solutions that can bolster customer satisfaction and brand loyalty. With e-commerce projected to maintain its upward trajectory, the demand for POD services is expected to escalate, making it a pivotal segment of the apparel industry.

The U.S. market is characterized by a multitude of players ranging from large-scale retailers to small independent designers who leverage POD solutions to minimize inventory costs while maximizing product variety. This shift towards direct-to-consumer sales models has prompted businesses to adopt innovative technologies that streamline operations and enhance consumer experiences.

Moreover, as sustainability becomes a focal point for consumers, on-demand printing offers a sustainable alternative to traditional manufacturing processes, minimizing waste by producing items only as they are ordered. This positions companies like Air Waves favorably amidst the increasing consumer preference for ethically produced goods.

The Rationale Behind the Deal

The acquisition of Air Waves by Hybrid Apparel is strategically significant for both companies, marking a new chapter in their respective growth trajectories. By integrating Air Waves' advanced POD services with Hybrid Apparel's established wholesale operations, the partnership is poised to enhance the value proposition offered to retail customers and brand partners alike. Hybrid's CEO Bill Hutchison emphasized the importance of combining top-tier creativity with exceptional technology, which is essential in unlocking new opportunities for their partners.

This collaboration also builds on a pre-existing fulfillment relationship between the two companies, which has already demonstrated successful outcomes. By expanding their combined capabilities, the partnership can efficiently cater to a broader clientele and address the surging demand for on-demand customized apparel.

Information about the Investor

Hybrid Apparel is a full-service design and apparel distribution company founded in 1997, with its headquarters in Cypress, California. The company has established a leading position in the industry through its comprehensive sourcing and supply chain solutions, excelling in customer delivery and service across various apparel categories. As a prominent player in brand and licensing management, Hybrid Apparel caters to both global and national brands across several sectors, including entertainment, music, gaming, and lifestyle brands.

Hybrid Apparel is also a portfolio company of Altamont Capital Partners, a private investment firm managing over $2.5 billion in assets. Altamont focuses on enhancing the potential of middle-market businesses through strategic partnerships with experienced management teams. Their investment philosophy centers around fostering growth within their portfolio companies, making them an ideal partner for Hybrid in this acquisition.

View of Dealert

The acquisition of Air Waves by Hybrid Apparel is viewed positively due to the strategic alignment of their business models and capabilities. By integrating Air Waves’ innovative POD services with Hybrid's extensive distribution network, the deal has the potential to create significant synergies, enhancing operational efficiency and expanding market reach. This collaboration caters to the growing trend of on-demand production and customization in the apparel industry.

From an investment standpoint, the burgeoning demand for personalized products in the U.S. market, coupled with the trend toward sustainable practices, presents a compelling case for this acquisition. The recent growth trajectory of Air Waves further underscores the investment's potential for continued expansion, especially as digital solutions become a critical aspect of the retail landscape.

Moreover, the leadership continuity, with Kyle Kantner remaining at the helm of Air Waves, ensures that the integration process will benefit from experienced guidance and a deep understanding of the operational intricacies. This continuity is essential for aligning the two companies' cultures and business strategies effectively.

In conclusion, this acquisition is positioned not only as a growth opportunity for both companies but also as a forward-thinking move that aligns with contemporary market trends. The combined strengths of Hybrid Apparel and Air Waves are likely to result in enhanced customer offerings in the dynamic apparel sector.

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