Los Angeles Fashion Brand Sanctuary Reportedly in Advanced Acquisition Discussions with WSG Group
The Los Angeles-based contemporary women’s fashion label Sanctuary appears poised for a potential ownership transition, with industry insiders indicating that exclusive acquisition negotiations are underway with WSG Group.
The brand, established by Ken and Deb Polanco who serve as co-founders and hold CEO and Chief Creative Director roles respectively, has reportedly entered into serious discussions regarding a sale. The husband-and-wife team launched Sanctuary Clothing in 1997 in Los Angeles, building it into a recognizable name in the contemporary fashion space.
The company’s ownership history includes a previous partial sale in 2008, when the Polancos divested approximately half their stake to the Camuto Group, only to regain complete control ten years later through a buyback arrangement.
Industry sources suggest that WSG Brands has obtained exclusive rights to pursue the acquisition, though financing arrangements are still being finalized. The target company operates a well-established wholesale business generating roughly $85 million in annual revenue while maintaining profitability in the competitive contemporary women’s apparel market.
Internal documentation reveals plans for Li & Fung to assume operational leadership of the brand post-acquisition, a strategic move designed to minimize operational risks while enhancing scalability and transforming fixed expenses into a royalty-based revenue model.
The connection between Sanctuary and Li & Fung predates these acquisition talks, as the companies formalized a licensing agreement in 2024 focused on manufacturing and distributing a premium women’s denim collection.
Representatives from WSG, Li & Fung, and Sanctuary have not responded to requests for commentary. Financial documents indicate WSG is seeking $70.5 million in investor equity, with a funding deadline of March 25. This total encompasses a $67 million purchase price plus an additional $3.5 million allocated for closing expenses and associated fees.
The proposed transaction structure would position Li & Fung to manage product development, sourcing operations, supply chain logistics, and sales execution while preserving the brand’s core identity and aesthetic. This partnership framework aims to maintain Sanctuary’s distinctive character while leveraging Li & Fung’s global infrastructure and operational expertise.
WSG’s strategy includes expanding Sanctuary’s licensing revenue streams across new product categories and international markets. Projections show licensing income growing from $13.9 million in the 2026-2027 period to $22.4 million by 2030-2031.
The brand recently marked a retail milestone with the launch of a 2,000-square-foot flagship store on North Beverly Drive in Beverly Hills. This location features exclusive collections, early product releases, and curated vintage and pre-owned items, serving as both a retail destination and customer engagement laboratory.
Originally built on a foundation of women’s bottoms, particularly cargo and utility pants, Sanctuary has evolved into a comprehensive ready-to-wear brand encompassing denim, knitwear, dresses, and outerwear. Wholesale channels represent 70 percent of current business volume, with key retail partnerships including Nordstrom and Bloomingdale’s. The Polancos have outlined expansion plans including a second flagship location, likely in New York, with ambitions to operate ten retail stores by 2030.
Under WSG ownership, Sanctuary would leverage the parent company’s licensing expertise to transform into a multi-category lifestyle brand with enhanced royalty revenues and improved profit margins. WSG’s strategic vision involves repositioning the label from a traditional apparel manufacturer into a global brand management platform with superior profitability and premium exit opportunities.
The brand portfolio also includes several diffusion lines that generate additional revenue without compromising the main brand’s positioning.
Li & Fung’s existing licensing portfolio features prominent brands including Express, Pendleton, Lands’ End, Vera Bradley, and Loft.
WSG’s recent acquisition activity includes the 2024 purchase of Von Dutch, the iconic Hollywood fashion and lifestyle brand. Under new management led by industry veterans Jack Cheika as CEO and Marc Benitez as COO, Von Dutch is pursuing expanded retail distribution, strategic collaborations, and strengthened omnichannel operations across the United States.