Cynthia Erivo, Emily Blunt, Sienna Miller and John Idol in the front row Michael Kors' Spring Summer 2017 runway show.
Jimmy Choo is in the books, but Michael Kors Holdings chairman and chief executive officer John Idol isn't done with serious luxury acquisitions — and has the structure in place to fund deals internally if necessary.Idol, who just this month completed Kors' $1.35 billion acquisition of Choo, detailed his thinking on future acquisitions at the Morgan Stanley Global Consumer and Retail Conference Wednesday.“We hope that there'll be something else that will be available for us to buy,” Idol said. “We want to do something that's significant, not something that's small, that's what our current thinking is.”Idol has previously signaled his desire to build Kors into a portfolio of brands and now that Choo has joined the fold and is being prepped for ambitious growth plans, the ceo seems to be thinking about the next steps.First, a little breather, to pay down the $1 billion the company pulled from its term loan for Choo (the recently secured $450 million in bonds that come due in 2024 are going to stay in place).“Our number-one priority is to pay down the term loan piece of what we did with Jimmy Choo,” Idol said. “We're going to do that very rapidly and then we will be in an incredible position again with the balance sheet that's very, very little leverage on it — and so we're prepared to do something of size and scale, and we have the means and the wherewithal to do that.”The company produces cash flow of close to $1 billion a year that can help pay down the debt. It also has a $1 billion revolving credit facility, which the ceo pointed to as a potential source of deal capital.“It's there for us to use so we can make sizable acquisitions even on our existing financing structure, not having to even go to the debt market if we don't need to,” Idol said.“The bigger issue is going to be finding the target,” he said. “We don't want to buy companies that have to go through a complete reset. That's not what we think is the best use of our time and energy. We want to buy companies that have great quality and actually have high levels of recognition outside of the U.S. market. We don't view the U.S. market as the high-growth engine for whatever brand we would acquire. We will actually probably say Asia first, Europe second, and North America third, and that's very typical when you're looking at a luxury goods company.”So Kors is looking for another Choo.In the process, Idol will likely find himself bumping up against Victor Luis, who reeled in Kate Spade this year and renamed Coach Inc. as Tapestry Inc. and is also looking to build a multibrand base.In the meantime, the firm has plans to double Choo, making it a $1 billion business, and to continue to reset its namesake business.For Choo, Idol said the three-pronged plan includes:• Growing the brand’s store base to a range of 200 to 250 doors, up from the roughly 150 locations it has now. Much of that expansion will take place in Asia.• Filling out Choo's accessories offering, expanding strongly beyond smaller evening bags.• Funding the already quickly growing men’s business to help it move even faster.Idol emphasized that Choo “doesn't need to be reengineered. It's a company that needs to have additional resources to grow more quickly.”The ceo was part of the team that built Kors into a $4.5 billion empire from just $17 million over 15 years. But he acknowledged recent missteps.“The growth trajectory was quite extraordinary,” Idol said. “And during the last two years of that, I think that we, as a company, didn't do as good of a job with the product and our design.”Kors is trying to lead in a fashion sense and is revamping nearly 70 percent of its assortment, renovating stores and cutting back on price promotions.“We followed other people's promotional cadence and I'm not talking about just competitors, I'm talking about some of the people who we partner with, and that really was a very bad thing for the company, for the brand and ultimately, for the consumer,” he said.The ceo described 2017 as a “transition year for the company” and said the current period would be “the most challenging quarter for us to get through because it'll be the biggest level of promotion that we're up against from last year.”But Idol said Kors remains solid.“Michael Kors is a very strong brand and when you put the right product in front of the consumer, that relationship is resonating,” he said.
There'll be no rest for those headed to Europe for men's, as Paris just closed the gap with Milan. According to a provisional calendar released by the Chambre Syndicale, Paris Men's Week will now open a day earlier on January 16. See new highlights on the official lineup on WWD.com. #wwdnews #wwdfashion (📷: @kukukuba)
BREAKING: Jonathan Saunders is leaving @DVF. The designer has resigned from his position as chief creative officer of Diane von Furstenberg, the company said in a statement on Friday. At the time of his hire, von Furstenberg said Saunders’ arrival symbolized and facilitated her stepping back from the day-to-day duties that occupy the work of a full-time creative director. The British designer joined DVF in May 2016 and was in charge of all product categories. #wwdnews
For @versace_official’s spring ad campaign, the brand emphasized the archival prints from the spring tribute collection dedicated to the late Gianni Versace. Closing out the show were five of Gianni’s favorite models: Cindy, Naomi, Carla, Helena, and Claudia. Bowing on December 18, the new campaign is yet another tribute to supermodel-dom as the images by Steven Meisel are fronted by @iamnaomicampbell, @cturlington, @gisele and more. #wwdfashion
Four-time Oscar-nominated actress Annette Bening has been waiting 20 years to play Gloria Graham in "Film Stars Don't Die in Liverpool," which will be released on December 29. The movie about Graham – a Hollywood star known for her controversial relationship with a younger Englishman named Peter Turner – is based off a memoir Turned wrote. "She felt vulnerable to him, because she loved him, she really did love him. And anyone that we really truly are in love with, we re vulnerable to in a very deep way," said Bening. Read our full interview with the modern icon of an actress on WWD.com. #wwdeye (📷: @ninebagatelles; Styled by @cristinaehrlich)
The crisp white button down: a staple that can be dressed up or down and accessorized throughout the decades. Here, on a Art Basel-goer in 2017 on the left and on the iconic Audrey Hepburn in “Roman Holiday” in 1953 on the right. #tbt #wwdfashion (📷: Andrew Morales)
Known for her work with @victoriassecret, 25-year-old model @georgiafowler is raising her profile in Hollywood. Fowler stars in @vincecamuto’s holiday campaign, which launched in partnership with “Pitch Perfect 3.” “Almost every shoot with Vince Camuto, I’ve had to face a fear…It was definitely a challenge. I’m so grateful for it, though. I’ve always wanted to be a pop star, so that was the perfect chance,” Fowler said. Head to WWD.com to read about Fowler’s experience modeling, including at the #VSFashionShow, and her relationship with Nick Jonas. #wwdeye (📷: @jilliansollazzo)
EXCLUSIVE: Huda Kattan just became the first beauty influencer to land a major beauty deal. Kattan's business, @hudabeauty, has received a minority investment from private equity firm TSG Consumer Partners. The brand, which industry sources say is on track to do $200 million in retail sales for 2017, will receive support on product, retail and geographic expansion through the deal. Get all the details on the deal and read @_a_collins' interview with Kattan on WWD.com. Link in bio. (📷: @jgreenery) #wwdbeauty #wwdnews
Peruvian model @juanaburga_official – who is known for walking the runways of @rodarte, @viviennewestwood and @torybuch – is making the move to the big screen with drama “Los Últimos.” The film premiered in Argentina in November and arrives in the U.S. and Europe in 2018. On making the switch from modeling to acting, Burga told WWD: “It’s a completely different thing – a lot of people think it’s similar or try to connect things, especially like getting used to the camera or being looked at all the time or playing these different characrers, but film is a completely different story.” #wwdeye (📷: @jgreenery)
London’s newly opened @designmuseum will look back on the life and work of Azzedine Alaïa in a show that the designer helped to curate before he died of heart failure last month. The retrospective, which Alaïa had worked on with Mark Wilson, chief curator of the @groningermuseum, will look at the impact of his work worldwide. The show, “Azzedine Alaïa: The Couturier,” will run from May 10 to October 7. Read more about the exhibit on WWD.com #wwdnews #wwdfashion (📷: @zefashioninsider)