NEW YORK — Peter Boneparth and Jones Apparel Group will be parting company when Boneparth's current contract expires.
Boneparth, chief executive officer and president of Jones, and the company have agreed not to extend his contract past March 31, 2009, according to a regulatory filing with the Securities and Exchange Commission.
The briefly worded document, on a Form 8-K, was filed March 27. Boneparth and Jones each delivered a "non-extension notice" to the other regarding Boneparth's employment agreement. Boneparth will continue as president and ceo through March 31, 2009, the end date of the existing contract. Had they agreed to an extension, Boneparth's contract would have been extended by one year.
Company executives have declined comment.
In a separate SEC filing, also on March 27, Efthimios Sotos, chief financial officer, resigned and was succeeded by Wesley Card, who once held that post before becoming the firm's chief operating officer.
During Boneparth's tenure, the company has had several notable successes and challenges, including:
-- Sales that have fluctuated between $4.6 billion and $5 billion over the past three years, as Jones absorbed several high-profile acquisitions, including Nine West, Anne Klein and Barneys.
-- A failed attempt to sell the company. Jones Apparel hired Goldman Sachs last year to shop the company around. Bids came in, but were too low, according to financial sources. In August of 2006, Boneparth said the "board has concluded that at this time, the best alternative to maximize long-term shareholder value is to continue executing on the company's strategic business plan."
-- A decline in the moderate market, which has challenged the company's ability to deliver robust earnings. In 2004, Jones posted net income of more than $300 million (and operating income of $528 million), but by 2006, the bottom line bottomed out with a loss of $144 million (and an operating loss of $166.7 million).
-- Challenges in pursuing acquisitions to grow the business. Boneparth told the WWD/DNR CEO Summit as far back as 2003 that smaller acquisitions — of less than $100 million — could be difficult to justify. "In our world, at that level, smaller deals really just don't move the needle," he said. "It probably comes across as arrogance, but it's really not. It's reality."
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