Kellwood Co. is stuck between a fed-up Wall Street and an angry major shareholder — and it must either deliver to the first or risk a hostile takeover by the second in 2008.
Since Sun Capital Securities Group LLC issued — then reissued — a $543 million bid for the St. Louis-based vendor this fall, the second-largest Kellwood shareholder has made it clear it intends to buy the $1.6 billion company despite Kellwood's two flat rejections of the $21 a share offer.
"Our strong preference is to acquire Kellwood in a friendly negotiated transaction," stated a letter issued last month by Jason G. Bernzweig, vice president of Sun Capital, to the Kellwood board, "but we are prepared to take all necessary steps to protect the value of our 9.9 percent ownership position in Kellwood, including making a $21 per share offer directly to Kellwood's other shareholders."
Sun Capital originally made its offer on Sept. 18, and a month later, Kellwood rejected that bid.
Kellwood has stepped up its efforts to persuade investors to have faith in its strategic plan. Robert C. Skinner Jr., chairman, president and chief executive officer of Kellwood, made several promises to shareholders, including that the company would boost organic sales growth to 4 to 5 percent, raise operating margins to 9 percent and grow earnings per share at least 25 percent.
But Sun Capital followed that announcement with a reiteration of its earlier offer, insinuating it did not have faith in Kellwood's execution record. Again, Kellwood turned down the bid.
Last quarter, Kellwood posted a loss from continuing operations of $66.3 million, which prompted a restructuring. Its third-quarter earnings will be released Friday. The stock has been trading between $14 and $19 during this period.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty