Apparel retailers Destination XL and FullBeauty agree to merger of equals (updated)

Destination XL

11/12/2025 21:45

Merger of equals aims for $25 million cost synergies by 2027

Combined company generates around $1.2 billion revenue

FullBeauty shareholders to own 55% of combined company

Changes attribution to the company, adds closing share price to sixth paragraph and deal timing in the last paragraph

By Abigail Summerville

Dec 11 - Retailers Destination XL Group DXLG.O and FullBeauty Brands agreed to merge, creating a bigger player in the size-inclusive apparel market, the companies announced on Thursday, confirming an earlier Reuters report.

The combined company generates approximately $1.2 billion of annual net sales, and expects cost synergies of $25 million by 2027.

FullBeauty shareholders are set to own 55% of the combined company while Destination XL (DXL) shareholders will own 45%.

The plus-size clothing market broadly has grown amid a drive for more body positivity and even users of GLP-1 weight loss drugs like Ozempic are ready to spend on apparel as they drop clothing sizes, industry analysts have said. However, the risk to DXL and FullBeauty is that customers will lose enough weight that they have to shop elsewhere.

DXL operates over 250 stores across the DXL and Casual Male XL banners, which sell clothes for big and tall men. FullBeauty has a portfolio of over a dozen plus-size brands including Cuup, Woman Within and Roaman's.

DXL shares had fallen around 45% year-to-date as its total revenue has also declined year-over-year. Its shares closed at $1.56 on Thursday for an $84 million market capitalization. FullBeauty emerged from bankruptcy in 2019 and Oaktree Capital Management is its largest investor.

The combined company will be better positioned to meet customers, including those using GLP-1 medications, at every stage of their weight-fluctuation journey through offerings such as DXL’s FiTMAP and FullBeauty’s free exchange program, the companies said.

The transaction is expected to close in the first half of 2026, subject to customary closing conditions and approval by DXL shareholders.

 (Reporting by Abigail Summerville in New York; Editing by Svea Herbst-Bayliss and Diane Craft)

 ((abigail.summerville@thomsonreuters.com))