NEW YORK -- Cygne Designs Inc. has completed the acquisition of Fenn Wright & Manson Inc., creating a private label powerhouse that last year had combined sales of about $370 million.

Cygne Designs issued 2 million shares, plus $10,000 in cash, in exchange for all the outstanding stock of Fenn Wright. At current market prices of about $22 a Cygne Design share, the deal is valued at $44 million. Plans for the acquisition were announced last September.

Colin C. Fenn, chief executive officer of Fenn Wright, will become a vice chairman and chief operating officer at Cygne.

"The acquisition enables us to leverage the complementarities of Cygne and Fenn Wright & Manson," noted Bernard M. Manuel, Cygne's chairman and chief executive officer. "We share the same strategy of combining design and merchandising expertise with the ability to manufacture products in high volume and short lead times."

Irving Benson, Cygne's president, who also continues as a vice chairman, added that Cygne's strength is primarily in woven career sportswear and knits, whereas Fenn Wright's is mostly in casual sportswear, sweaters and woven silk products.

"The combined company will offer well-balanced strength in all categories of woven and knit casual and career sportswear for women," he said.

Fenn Wright also designs and manufactures men's casual sportswear, which will be a new area for Cygne.

Cygne's main customers are Ann Taylor, The Limited Stores and Express while Fenn Wright's are The Limited Stores, Lane Bryant, Lerner and Victoria's Secret catalog as well as several major department stores, including Dillard's, Federated, Macy's, Dayton Hudson, and J.C. Penney.

Fenn Wright makes private label and branded women's and men's sportswear in the U.S. and the U.K. It had net income of $4.4 million in the year ended Dec. 31 on sales of $151.3 million. Fenn Wright's earnings included merger costs of $600,000 and a $1.2 million charge for a tax accounting change.

According to forecasts from Manuel, Cygne Designs' sales reached $220 million in its year ended Jan. 31, against $125 million the previous year, and net income rose to $6.1 million from $3.1 million. In the nine months, Cygne Designs, which went public in July at $10 a share, reported earnings more than doubled in the nine months, to $3.7 million, or 60 cents a share. Sales grew 104 percent, to $157.9 million from $77.4 million.

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