By  on November 17, 2005

NEW YORK — When it comes to mergers and acquisitions, having a top-notch, well-informed management team in place that can recognize its strengths and fix its weaknesses as well as work with a financial adviser can either make or break a deal.

This was one of the themes of "Merge or Acquire: What to Look for in the Deal," a one-day conference hosted by Emanuel Weintraub Associates Inc. here at the Princeton Club on Tuesday, and attended by retail, banking and vendor executives.

Laurence C. Leeds Jr., chairman of Buckingham Capital Management, opened the program with an overview of how the retail and apparel landscape has changed since the Fifties. "When I worked as a salesman at Manhattan Shirt Co. in the 1950s, there were 5,000 specialty door accounts and 250 department stores on the [sales] list. In 1990, there were still 100 large department stores. Now, with the merger of Federated and May, we have one really great national department store," Leeds said, adding that "most of the mergers have resulted in a very strong entity at the end."

Paul Charron, chairman and chief executive officer of Liz Claiborne Inc., said his firm prefers acquisitions, whereby the existing management team wants to stay on post-acquisition. "Emotional and undisciplined founders present a significant risk. We won't do that [kind of acquisition]," he said.

Charron described the 2001 purchase of Mexx as the single "most strategic" acquisition for the company. He said it gave Claiborne an "extension into a part of the world where we didn't have any meaningful presence, and where we frankly were not very good. The Europeans run our European businesses. They think with European sensitivities, and they've done a bang-up job."

The company, which won't buy companies that aren't accretive to earnings within 12 months, began its acquisition spree in earnest in 1999 when it bought Sigrid Olsen and Lucky Brands. Charron said Monet in 2000 has been the "single most accretive acquisition. We made a lot more in year one than what we paid" for the company. Meanwhile, the firm bought "Enyce because we wanted to do business with Pacific Sunwear, and it is a big supplier to D.e.m.o."

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