Harel Wiesel's Fox Group Sells European American Eagle Stake After Losses

The Fox Group, owned by Harel Wiesel, is set to exit its joint venture with American Eagle in Europe, known as AEO Europe Retail Co. B.V. Fox announced on Wednesday that it has signed a non-binding term sheet to sell its entire 49% stake in the partnership for $2 million. The deal, expected to close in the fourth quarter, will leave American Eagle with full ownership of the European venture.

The partnership was established in 2022 with the aim of selling American Eagle's fashion brands across Europe, with American Eagle holding a 51% share and Fox the remaining 49%. Initially, the joint venture planned to operate in multiple Western and Eastern European countries, with potential expansion beyond Europe. Currently, the company operates five stores in the Netherlands and an online sales platform.

Fox attributed the decision to sell to the joint venture's "lack of contribution to its operational results." The European expansion fell significantly short of original plans, with only six stores operating at its peak, one of which has since closed. According to 2025 financial reports, the venture incurred approximately 18 million shekels in losses, with Fox's share of the deficit being about half of that amount.

This move occurs amid a challenging period for American Eagle itself. Earlier this month, the company's stock dropped approximately 11% after it issued a forecast for flat gross margin growth, citing high inventory levels and weakness in its core brand. Inventory costs increased by 14%, partly due to tariffs, while rapid shifts in consumer preferences for jeans forced the company to increase promotions and discounts.