Seven down in 2007 — nine more brands to divest of in 2008.
Since Liz Claiborne Inc. said on July 11 that it was putting 16 of its brands under review, the industry and investment community alike have been waiting to see how long it would take to dispose of the brands, how much they would sell for and what would happen to their brand equity given their uncertain futures.
The $4.99 billion firm accepted formal offers from what it has called "serious bidders" for the nine contemporary, better, bridge and active brands last Friday. Dealing with these higher-margin businesses has been tagged "Phase II" of the review process by the firm. Now that bids are finally in, negotiations can begin.
Claiborne has declared it will complete the review process on the remaining brands by the end of the first quarter next year, and chief executive officer William L. McComb said he is optimistic the process could be completed even sooner, based on industry interest.
According to sources, while many companies are interested in the brands — Dana Buchman, Ellen Tracy, Sigrid Olsen, Enyce, Prana, Mac & Jac, Kensie, Laundry and C&C California — fewer are interested in the hefty prices Claiborne is asking.
The conglomerate — which is holding onto its direct "power brands" Juicy Couture, Kate Spade, Lucky Brand Jeans and Mexx — is also giving preferential treatment to bidders that will buy packages, according to sources. For example, Claiborne is hoping to sell Dana Buchman, Ellen Tracy, Sigrid Olsen and other brands in one transaction, a process that has made some buyers, who want some but not all of the brands, skittish.
Companies can still bid for a single brand, though. For example, Schottenstein Stores Corp., which owns retailers including American Eagle Outfitters and Filene's Basement and which acquired Adrienne Vittadini in December of last year, put a bid in for Laundry by Design. G-III Apparel Group Ltd. is in the bidding for Ellen Tracy, said a source. G-III currently has the Ellen Tracy licenses for outerwear, as well as suits and dresses. Enyce, Prana and C&C California all also appear to have found separate strong buyers, according to a source.
Everyone from industry observers to McComb himself has agreed the sooner the process can be completed, the better for all parties. Retailers have been buying the brands' merchandise conservatively, uncertain of their new owners and distribution channels. Also, even with Claiborne's incentives to keep employees on during the review, retaining talent in times of uncertainty is always a concern.
In September, Claiborne completed "Phase I," settling the fates of its seven moderate brands. Li & Fung USA, a subsidiary of Li & Fung Ltd., bought four of Claiborne's moderate brands — Emma James, Tapemeasure, JH Collectibles and Intuitions — via its Regatta division. Li & Fung president Rick Darling has denied his company was entering a second round of bidding for additional brands.
Alberta Ferretti's "Rainbow Week" sweaters are back. The designer closed her #MFW show with a few day-of-the-week sweaters, which first debuted on the catwalk last January as part of the pre-fall 2017 collection. #wwdfashion (📷: @delphineachard)