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Coach to Acquire Kate Spade for $2.4B

Coach to Acquire Kate Spade for $2.4B

Kate Spade engaged bankers to explore strategic alternatives, as reported by ExitHub earlier this year. Kate Spade shareholders will receive $18.50 per share in cash, representing a 27.5% percent premium to the unaffected closing price of Kate Spade’s shares as of December 27, 2016, the last trading day prior to media speculation of a transaction. The deal has been unanimously approved by the Boards of Directors of both companies and is expected to close in the third quarter of 2017, subject to customary closing conditions. Kate Spade operates principally under two global, multichannel lifestyle brands: kate spade new york and Jack Spade New York. The company’s four category pillars – women’s, men’s, children’s and home – span demographics, genders and geographies. Known for crisp color, graphic prints and playful sophistication, kate spade new york aims to inspire a more interesting life. The kate spade new york collection includes the Madison Avenue, Broome Street and on purpose labels. Jack Spade New York offers a timeless and versatile assortment of bags, sportswear and tailored clothing founded on the aesthetic of simple, purposeful design. The company also owns Adelington Design Group, a private brand jewelry design and development group. “Kate Spade has a truly unique and differentiated brand positioning with a broad lifestyle assortment and strong awareness among consumers, especially millennials,” said Victor Luis, Chief Executive Officer of Coach. “Through this acquisition, we will create the first New York-based house of modern luxury lifestyle brands, defined by authentic, distinctive products and fashion innovation. In addition, we believe Coach’s extensive experience in opening and operating specialty retail stores globally, and brand building in international markets, can unlock Kate Spade’s largely untapped global growth potential. We are confident that this combination will strengthen our overall platform and provide an additional vehicle for driving long-term, sustainable growth.” The Coach brand was established in New York City in 1941, and has a rich heritage of pairing exceptional leathers and materials with innovative design. Coach is sold worldwide through Coach stores, select department stores and specialty stores, and through Coach’s website. In 2015, Coach acquired Stuart Weitzman, a global leader in designer footwear, sold in more than 70 countries. “Following a thorough review of strategic alternatives, reaching an agreement to join Coach’s portfolio of global brands will maximize value for our shareholders and positions Kate Spade for long-term success as we continue our evolution into a powerful, global, multi-channel lifestyle brand,” said Craig A. Leavitt, Chief Executive Officer of Kate Spade. The deal is not subject to a financing condition. Coach has secured committed bridge financing from BofA Merrill Lynch. The $2.4 billion purchase price is expected to be funded by a combination of senior notes, bank term loans and approximately $1.2 billion of excess Coach cash, a portion of which will be used to repay an expected $800 million 6-month term loan. Coach’s financial advisor is Evercore Group LLC and its legal advisor is Fried, Frank, Harris, Shriver & Jacobson LLP. Kate Spade’s financial advisor is Perella Weinberg Partners LP and its legal advisor is Paul, Weiss, Rifkind, Wharton & Garrison LLP.]]>

@LVMH Acquires 80% Stake in German Luggage Group @Rimowa for $716M

@LVMH Acquires 80% Stake in German Luggage Group @Rimowa for $716M

maison of the LVMH Group, and Alexandre Arnault will be appointed co-CEO of Rimowa. Rimowa has become one of the quintessential houses for innovative, high-quality luggage over the course of the twentieth century. The business has built its reputation designing lightweight and easy to use luggage and Rimowa suitcases today serve as the industry benchmark for German quality. Rimowa products are now distributed in 65 countries, through nearly 150 stores via licensees and a network of specialized partners, with a turnover expected to exceed 400 million euros at the end of 2016. Rimowa, with 3,000 employees worldwide, provides integrated design and product development in Germany along with the majority of manufacturing, combining artisanal craftsmanship with precision technology. “Over the past two years I have had the opportunity to establish close ties with the Arnault family, and in particular with Alexandre,” said Dieter Morszeck. “Alexandre and I have discussed at length the attractive development prospects available to us and the common values that we share. I am delighted that he is joining Rimowa and I have full confidence in his ability to accelerate the development of the business by my side.” “Rimowa is a superb business which I have followed as a loyal customer for many years. Rimowa has revolutionized the luggage industry for over a century, its suitcases are renowned for their unique performance, quality and design. I am honored to join Rimowa and to be working alongside Dieter,” said Alexandre Arnault. “Rimowa is a brand with a unique heritage. We share with Dieter Morszeck the same passion for innovation and a common desire to offer very high-quality products derived from a European tradition of craftsmanship. What’s more, it brings me great pleasure that Rimowa will be the first German house to join the LVMH Group. Germany is recognized all over the world for the vitality of its family businesses and for the quality of their products,” added LVMH chairman and chief executive Bernard Arnault. Since its creation by Paul Morszeck, innovation has been at the heart of Rimowa’s strategy. In 1937, his son Richard launched the first aluminum suitcase available on the market. The aluminum structure comprising parallel grooves makes the luggage instantly recognizable and has played its part in building the reputation of Rimowa among a sophisticated international clientele. His son Dieter designed the first waterproof metal case in 1976, since which time Rimowa suitcases have become the travelling companion of choice for the greatest filmmakers, photographers and journalists. Rimowa revolutionized the industry when it launched the first polycarbonate suitcase in 2000. A patented system of ball bearings ensures optimum stability. Since 2014, Rimowa has also been developing its “Bossa Nova” range which combines lightweight polycarbonate with the elegance of leather. This suitcase is a tribute to the English artist and botanist Margaret Mee who devoted her life to painting and protecting plants from the Amazon. Rimowa donates a portion of its sales to the Association Saúde e Alegria which supports social projects in the Amazon. More recently, in partnership with Lufthansa, the company launched the Rimowa Electronic Tag. This innovative feature simplifies baggage check-in by matching, with the use of a smartphone, the boarding card with a bluetooth electronic tag integrated only within Rimowa suitcases. For over 60 years, Rimowa suitcases have been inspired by the remarkable story of commercial aviation and the fuselage of the first metallic plane, the Junkers F-13. Thanks to the financial support of Rimowa, a seven year project made it possible to reconstruct this legendary aircraft. The inaugural flight took place on September 15, 2016, nearly a century after its first commercial use in 1919. This revival embodies the exceptional heritage of the house. Photo (L-R): Alexandre Arnault of LVMH, Dieter Morszeck, Chairman of Rimowa, and Bernard Arnault, Chairman & CEO of LVMH.]]>

@LVMH Buys Iconic Rodeo Drive House of Bijan for $122M, at Record $19.4k/PPSF

@LVMH Buys Iconic Rodeo Drive House of Bijan for $122M, at Record $19.4k/PPSF

The Rich. The sale price makes the deal “considerably ritzier” than Chanel’s purchase of its Rodeo store last year for $152 million, or $13,217 a square foot – then a retail record per square foot for California, said the Los Angeles Business Journal. The sale to LVMH is the latest high-profile deal on the Beverly Hills shopping street, which is home to luxury retailers such as Gucci and Prada. Louis Vuitton already has a store near the 6,287-square-foot Bijan building it purchased at 420 N. Rodeo Drive, the Los Angeles Times said. Rodeo Drive ranks second among the most expensive U.S. retail destinations, trailing only upper Fifth Avenue in Manhattan, according to Cushman & Wakefield. The property is fully occupied by Bijan, a world-class fashion house founded in 1976 by the late Iranian-American designer Bijan Pakzad. The exclusive boutique caters to the ultra-high-net-worth international shoppers by appointment-only. Bijan has successfully operated at the property for more than 40 years and is the longest-standing privately-owned designer house on Rodeo Drive. The Bijan building is one of the most-recognizable storefronts in retail. The renowned yellow Rolls-Royce Phantom and the yellow and black Bugatti Veyron (both Bijan limited editions) match the building’s façade and interior and have long been hallmarks of the internationally-acclaimed custom clothier. Born in Tehran in 1940, Bijan migrated to Los Angeles in 1973. His exclusive boutique on Rodeo Drive has been described as “the most expensive store in the world.” Among his clients, Bijan claimed to count five U.S. Presidents – both George Bush and his son, Barack Obama, Ronald Reagan, and Bill Clinton – and other world leaders such as Vladimir Putin, Tony Blair, and King Juan Carlos of Spain. He also dressed other fashion designers, such as Oscar de la Renta, Tom Ford, and Giorgio Armani, and high-profile Hollywood celebrities including actors Tom Cruise and Anthony Hopkins, as well as Walt Disney’s chairman and CEO Michael Eisner. Bijan’s fragrances for both men and women are known for their distinctive circular glass flacon with an open center and a dividing web. When half full, the fragrance fills two separate chambers, seemingly defying the law of gravity that liquid seeks its own level. One of these perfume bottles is featured in the permanent exhibit of the Smithsonian Institution. According to the 2001 Los Angeles Times Calendar Section, the Bijan Perfume and Fashion Business has brought in an estimated $3.2 billion in sales worldwide. Bijan has been married twice. His first wife was Sigi Pakzad, a Swiss-German whom he met while living in Europe in the 1960s. They had one daughter, Daniela Pakzad, and divorced when she was 17. His second wife was Irish-Japanese interior designer and model Tracy Hayakawa. They married in 1986 and divorced in 1995. They had two children together, Nicolas Bijan and Alexandra. She later remarried businessman David H. Murdock. In April 2011, Bijan suffered a stroke, which required emergency brain surgery, but never recovered and died two days later in Los Angeles. The House of Bijan lived on however, without losing its appeal. Holliday Fenoglio Fowler LP (HFF), a unit of HFF Inc. (NYSE: HF), represented the property sellers, reportedly Brooks Caddell Barton Trust and Dominium Management Corp. Dominium is one of the largest and fastest-growing affordable housing owners in the U.S. Brooks Cadell Barton, who died in 2013, was a senior executive at Coldwell Banker International Real Estate and Home Savings of America, after serving as managing publisher of the Hollywood Reporter. He then left the corporate world to become a shaman and spiritual teacher, opening a retreat in Ojai, Calif., and a school called Art of God. The HFF team was led by Marc Schillinger, Bryan Ley and Bill Fishel. “We are thrilled with the record pricing we were able to achieve on our client’s behalf,” Schillinger said. The sale of the Bijan building comes on the heels of the HFF-brokered sale of Runway Playa Vista, as well as high-street retail transactions on Melrose Avenue and Melrose Place, adding to the more than 4.7 million square feet of retail space that HFF has transacted on so far this year in the greater Los Angeles area.]]>

G-III Apparel $GIII to Acquire Donna Karan From @LVMH in $650M Deal

G-III Apparel $GIII to Acquire Donna Karan From @LVMH in $650M Deal

The Queen Of Seventh Avenue, extended her women’s ‘Donna Karan New York’ line by creating a less expensive clothing line for younger women, called DKNY. Two years later, she created DKNY Jeans, a denim-inspired collection. DKNY for men was launched in 1992, one year after the ‘Signature’ line for men had been presented. Karan left her CEO position in 1997, but continued as chairwoman and designer for the Donna Karan line. LVMH acquired Donna Karan’s company in 2002 for about $243 million, and “shelved her flagship line Donna Karan International shortly after she left in June 2015,” said the New York Post. “Donna Karan International is an iconic global fashion company. Its lifestyle aesthetic resonates well with consumers throughout the world,” said Morris Goldfarb, chairman, CEO and president of G-III. “Donna Karan brings increased scale and diversification, while providing incremental growth on top of our portfolio of some of the best fashion brands in the world.” “When G-III approached us about acquiring the brand, we concluded that the time was right,” said Toni Belloni, group managing director of LVMH. “We are pleased to have reached an agreement with G-III.” G-III plans to fund the acquisition through new indebtedness, $75 million of newly issued G-III common stock to LVMH, and a $75 million 6½ year seller note. In connection with the acquisition, G-III has obtained financing commitments from Barclays and JPMorgan Chase Bank for a $525 million ABL credit facility and a $450 million 6-year term loan. The closing of the transaction is not subject to financing conditions. Barclays is acting as exclusive financial advisor to G-III. Norton Rose Fulbright US LLP and Simpson Thacher & Bartlett LLP are acting as legal advisors to G-III. Barack Ferrazzano Kirschbaum & Nagelberg LLP is acting as legal advisor to LVMH. G-III is a leading manufacturer and distributor of apparel and accessories under licensed brands, owned brands and private label brands. G-III’s owned brands include Vilebrequin, Andrew Marc, Marc New York, Bass, G.H. Bass, Weejuns, G-III Sports by Carl Banks, Eliza J, Black Rivet and Jessica Howard. G-III has fashion licenses under the Calvin Klein, Tommy Hilfiger, Karl Lagerfeld, Kenneth Cole, Cole Haan, Guess?, Jones New York, Jessica Simpson, Vince Camuto, Ivanka Trump, Ellen Tracy, Kensie, Levi’s and Dockers brands. Through its team sports business, G-III has licenses with the National Football League, National Basketball Association, Major League Baseball, National Hockey League, Hands High, Touch by Alyssa Milano and more than 100 U.S. colleges and universities. G-III also operates retail stores under the Wilsons Leather, Bass, G.H. Bass & Co., Vilebrequin and Calvin Klein Performance names. LVMH Moët Hennessy Louis Vuitton is represented in Fashion and Leather Goods by a portfolio of brands that includes Louis Vuitton, Céline, Loewe, Kenzo, Givenchy, Thomas Pink, Fendi, Emilio Pucci, Donna Karan, Marc Jacobs, Berluti, Nicholas Kirkwood and Loro Piana. Its Wines and Spirits division includes Moët & Chandon, Dom Pérignon, Veuve Clicquot Ponsardin, Krug, Ruinart, Mercier, Château d’Yquem, Domaine du Clos des Lambrays, Château Cheval Blanc, Hennessy, Glenmorangie, Ardbeg, Wenjun, Belvedere, Chandon, Cloudy Bay, Terrazas de los Andes, Cheval des Andes, Cape Mentelle, Newton et Numanthia. LVMH is present in the Perfumes and Cosmetics sector with Parfums Christian Dior, Guerlain, Parfums Givenchy, Parfums Kenzo, Perfumes Loewe as well as other promising cosmetic companies (BeneFit Cosmetics, Make Up For Ever, Acqua di Parma and Fresh). LVMH is also active in selective retailing as well as in other activities through DFS, Sephora, Le Bon Marché, la Samaritaine and Royal Van Lent. LVMH’s Watches and Jewelry division comprises Bulgari, TAG Heuer, Chaumet, Dior Watches, Zenith, Fred, Hublot and De Beers Diamond Jewellers Ltd, a joint venture created with the world’s leading diamond group. LVMH is headquartered in Paris, France.]]>

Galeries Lafayette Group Acquires @InstantLuxe Pre-Owned Goods Startup

Galeries Lafayette Group Acquires @InstantLuxe Pre-Owned Goods Startup

LuxuryDaily. Interest in consignment of luxury goods among affluent consumers has reportedly been on the rise. The deal is said to be designed to accelerate Galeries Lafayette’s omnichannel strategy. In 2016, Galeries Lafayette Group reached a new milestone of its innovation strategy by launching an accelerator dedicated to startups transforming retail and fashion. Developed in partnership with Plug and Play, a recognized player of the silicon valley with international reach, this accelerator baptized “Lafayette – Plug and Play” aims to develop an integrated platform to assist startups willing to disrupt fashion and retail by creating an innovation ecosystem. “Lafayette – Plug and Play” is based in a dedicated 1,000 sqm office space located in the heart of Paris. It will offer entrepreneurs a specifically curated program, providing unique services and workspace, as well as skills, network and capital investments.]]>