NEW YORK — Ken Lefkowitz, partner and co-head of the mergers and acquisitions group at Hughes Hubbard & Reed, which represented Nautica in its sale to VF Corp., finally got a good night’s sleep Monday night.

“It’s been a tough five or six weeks,” said Lefkowitz, who worked around the clock to get the deal completed Monday.

As reported, the two firms on Monday said they had signed an acquisition deal under which VF would pay Nautica stockholders $17 a share in cash, in addition to $14.6 million, net to tax, to cash out employee stock options for a total consideration of roughly $585.6 million.

Wall Street traded up VF shares 27 cents, or 0.8 percent, on Tuesday to $35.86 on the New York Stock Exchange. Shares of Nautica slid 3 cents, or 0.2 percent, to close at $16.75 after skyrocketing more than 27 percent on the Nasdaq Monday.

Meantime, Moody’s Investors Service said Tuesday that it has put some of VF’s debt ratings on review for possible downgrade following the announcement of the proposed Nautica acquisition.

Lefkowitz also represented Andrew Grossman and Alexander Vreeland in establishing G.A.V., a company formed recently to develop new lines. G.A.V. has a partnership with Kellwood Co. to market the CK Calvin Klein women’s line and also has the license for Emanuel Emanuel Ungaro.

Lefkowitz said the looming deadline of Nautica’s scheduled annual shareholder’s meeting on Tuesday, where Barington Group was trying to unseat two of its board members and replace them with its own nominees, didn’t affect him one bit.

“We were not moved by one iota to sell the company,” said Lefkowitz. He said if the deal hadn’t been completed by Monday, Nautica would have had its annual meeting Tuesday and completed the deal Wednesday. As it turned out, the deal was completed Monday morning, and the shareholders meeting got postponed.

“We said, ‘We’re not going to rush this thing.’ There was no pressure to get it done. We worked all night for long periods of time, but I told VF on several occasions that whenever we get it done, we get it done,” said Lefkowitz. Davis Polk was VF Corp.’s attorneys.Lefkowitz stressed that Barington’s proxy battle was “absolutely irrelevant,” to the sale.

“It had absolutely nothing to do with them. What they got is incredibly lucky. Nautica’s board has always looked at the best interests of the company,” he said.

Lefkowitz pointed out that Nautica has an eight-member board, and therefore eight votes. He said if Barington got its two people on the board, they would have gotten two votes and a seat at the table, but it wouldn’t have changed anything.

“It was purely a financial play. They bought the shares in April for between $10 and $11. That’s pretty good,” said Lefkowitz.

Barington bought a 3.1 percent stake in Nautica, acquiring a little more than one million shares between April 17 and June 9.

“We made a profit and all the shareholders made a profit,” said James A. Mitarotonda, president and chief executive officer of Barington Cos. Equity Partners L.P. on Tuesday. “I feel our actions had a lot to do with what took place.” After the deal between VF and Nautica was signed, Barington decided not to pursue its pending proxy solicitation, as reported.

One of the board members that Barington was trying to unseat was Charles Scherer, managing partner of Hughes Hubbard & Reed, whom Barington felt wasn’t an “independent” director who represented the best interests of the shareholders.

But does that create a conflict of interest, if the law firm’s managing partner sits on the board of the company for which the law firm does work, and is representing in a sale?

“It wasn’t a conflict,” insisted Lefkowitz. “Chuck [Charles Scherer] has never charged Nautica for any of his time. He doesn’t do any of the legal work and he doesn’t get any credit. It was a red herring. The guys [at Barington] were looking for an angle.” Lefkowitz explained that the law firm is required to disclose any payments over $60,000.

According to Nautica’s definitive proxy statement, for the fiscal years ended 2003, 2002 and 2001, Nautica paid $539,000, $1.4 million and $1.6 million, respectively, to Hughes Hubbard & Reed. The report discloses that Scherer, one of its board members, is managing partner of Hughes Hubbard & Reed, and that the law firm also employs Samuel Sultanik, the brother-in-law of Nautica chairman, ceo and president Harvey Sanders.“Charles Scherer is a managing partner and he doesn’t practice law. He was a partner here for 20 years and left the firm in the 1980s to join Collins & Aikman as general counsel and chief financial officer. He now runs [Hughes Hubbard & Reed’s] 300-person international law firm. He’s a business guy and he doesn’t practice,” said Lefkowitz.

As Nautica’s law firm, “our interest is not to sell the company,” said Lefkowitz. “Scherer’s job [as a Nautica board member] is to protect the best interests of the shareholders.”

However, Barington’s Mitarotonda sees it differently.

“He’s responsible for running the law firm. That’s even more of a conflict. He wants to do what’s best for his company. He’s the managing partner of the law firm,” said Mitarotonda.

Regardless, Lefkowitz said he was pleased with the way it all worked out.

“I think everybody is happy. It’s a win-win situation for Harvey [Sanders], David [Chu, Nautica’s vice chairman] and VF. There are a few properties that are out there in the market that are transforming. It was a great negotiation. There was incredible chemistry between Harvey and Mackey [McDonald, chairman and ceo of VF]. Often in deals, there are adversaries and lawyers and people hammering at each other. The tone was set from the top. Harvey and Mackey got along so well, and we thought if we could find a way to do this, we should do this.”

Moody’s is taking a cautious stance toward the VF-planned acquisition of Nautica, however. The rating agency on Tuesday put VF’s “A2” long-term and “P-1” short-term debt ratings on review for possible downgrade, in light of risks associated with the deal as well as softness in the firm’s core businesses.

VF plans to borrow $400 million to finance the acquisition, which would strain the firm’s debt protection measures, said the rating agency.

“Moody’s acknowledges strategic advantages and a broadening of product lines and potential licensing revenue via this acquisition, but believes the acquisition also represents higher integration risk, with an increase in VF’s reliance on the challenged department store channel, and its fashion risk,” said fixed income analyst Charles O’Shea in a statement.“Nautica is a department store brand and it’s a more fashion-forward brand than the other things VF does, so from that perspective, it’s certainly a more challenging business model than what they had before,” added O’Shea in a telephone interview.

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