Few things seem more distant from the brightly lit world of fashion than the oily business of global energy tankers. But while Lionel Messi leads Argentina into the spotlight of Sunday’s Copa América final, his former partner in a flop of a casual clothing line is drifting toward an unheralded ending as part of a Marshall Islands-based oil tanker management firm.
MGO Global, a fashion house that until this spring designed and sold the Messi Brand of casual clothing and gear, is in the midst of selling itself to Heidmar Inc., a firm that manages a global fleet of oil tankers. It’s an ignominious ending to what was once a heralded partnership between perhaps the world’s most popular athlete and a top-flight fashion designer.
In 2018, Messi and Ginny Hilfiger, the design chief behind the reinvention of FILA and a former executive at her brother Tommy’s eponymous firm, teamed up to launch the Messi Brand, a line of Hilfiger-designed T-shirts, coats and hoodies, many themed with representations of the soccer star’s tattoos. Hilfiger co-founded MGO Global in 2018 to commercialize Messi’s clothes through a licensing deal with the soccer star for consumer clothing and products excluding sports gear.
The company went public at $5 a share in 2023, just after Messi led Argentina to the World Cup title. MGO’s audacious goal, as stated in its prospectus: Create “a performance-driven lifestyle brand portfolio company focused on strategically leveraging the fame, celebrity power and global social media influence of world class athletes, entertainers and other cultural icons.”
But sales of the Messi Brand never were enough to cover MGO’s costs to produce and sell the gear, slumping to just $83,000 worth of graphic tees and other paraphernalia in the first three months of this year. In March, MGO pulled the plug on the effort and sold its rights to the Messi Brand, including its website and all of Hilfiger’s designs, to a larger competitor, Centric Brands, for $2 million cash and the assumption of the rest of 2024’s royalty payments to Messi.
By the end of September, MGO will be folded into Heidmar, “a ‘one-stop’ solution for all maritime services in the crude oil, refined petroleum products and dry bulk shipping sectors,” it said in a press release announcing the merger with MGO. “We are thrilled,” said MGO CEO Maximiliano Ojeda in the release.
What thrilling business do a fashion design house and crude oil tanker manager have being merged together? None.
But MGO’s Nasdaq stock listing gives Heidmar an easy, inexpensive way to get listed in the U.S., the world’s most desirable equities market. Prior to the merger announcement in late June, MGO shares were at 23 cents, giving the business a market cap of just $4.2 million. The merger with Heidmar values MGO at about $1 a share, or $18 million. Heidmar’s existing shareholders will get $300 million in stock in the newly combined business when the deal closes, expected by the end of the third quarter.
Had Heidmar sought to take a traditional U.S. IPO, it would take months to file and get the paperwork approved by regulators and probably would cost nearly double in fees, according to data compiled by PriceWaterhouse on IPO costs. Such “reverse mergers” are common among businesses seeking to sidestep sometimes onerous Securities & Exchange Commission regulations and companies with little prospect for a rebound, like MGO. The combined business will be registered in the Marshall Islands, presumably for tax purposes, though it is run out of Connecticut. Neither Hilfiger, Ojeda or any of MGO’s other executives will stay in the venture when the merger closes.
As for Messi, the failure of MGO is barely a blip on his winning reputation and didn’t cost him a penny. The superstar never took equity in MGO, instead taking a guaranteed minimum cash payment of €4 million (about $4.4 million) over the three-year deal he inked with MGO, which expires this December.
His Messi Brand also has new life under Centric, which in June announced the Messi Brand as if it were a new launch. Presumably, Centric has reached an agreement with Messi to extend the license beyond this year, though a spokesperson for Centric didn’t respond to a request for comment.
“I hope that it will be liked by people,” Messi said in Centric’s announcement. One thing is certain: Not enough people liked it under MGO.