Cherokee Inc. has added to its portfolio of managed brands with the acquisition of Liz Lange Maternity and Completely Me from an affiliate of Bluestar Alliance LLC for $14 million.
The Lange maternity collection has been distributed exclusively at Target Corp. stores for the last 10 years. Lange’s two-year-old sportswear offshoot, Completely Me, is carried by HSN in the U.S. and by The Shopping Channel in Canada.
The purchase price, which includes provisions for performance-based earn-outs, will be covered through a new term loan with J.P. Morgan Chase & Co.
“In addition to Liz Lange’s current distribution, we see an opportunity to leverage our global platform, which spans nearly 40 countries worldwide,” said Henry Stupp, chief executive officer of Cherokee. Stupp told WWD that he expects the acquisition to be immediately accretive to Cherokee’s results.
Cherokee’s namesake brand is distributed exclusively in the U.S. through Target and through other direct-to-retail licenses with retailers including Tesco for the U.K., Ireland and certain Central European markets; RT-Mart in China; Pick n Pay in South Africa, and Arvind Mills in India and certain Middle Eastern markets. A pioneer of the direct-to-retail licensing model, it also owns brands including Sideout and Carole Little.
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“We see the opportunity to deliver top-line growth through enhanced merchandising and market initiatives as well as expanded distribution worldwide,” Stupp said.
The acquisition was made through Bluestar’s LLM Manage-ment affiliates. Other brands in the Bluestar portfolio include Joan Vass, Kooba, Yak Pak, English Laundry and Harvé Benard.
Lange, who has entered into a consulting agreement with Cherokee, started the firm in 1997 and sold to Bluestar in 2007. Industry sources at the time put the price at more than $50 million.
Further details of the deal are expected to be discussed when Cherokee reports second-quarter results today.