NEW YORK — Liz Claiborne Inc. added another brand to its portfolio on Thursday, acquiring two-year-old C & C California Inc. for an initial price of $28 million.
The cost, which represents 60 percent of C & C’s initial valuation, is subject to additional payments in the 2007, 2008 and 2009 fiscal years that will be based on a multiple of C & C’s earnings in each year. The company, which primarily manufactures premium apparel for women through its C & C brand, generated net sales of $21 million in the 2004 fiscal year, according to Liz Claiborne.
Los Feliz, Calif.-based C & C recently launched lines for men and children, but its women’s products account for 96 percent of total sales. The target base is women between 18 and 45, as well as Baby Boomers.
C & C products are sold at select specialty stores such as Scoop, Barneys New York and Ron Herman, as well as department stores, including Neiman Marcus, Saks Fifth Avenue, Nordstrom, Bloomingdale’s and Macy’s West. Known for its signature T-shirt collection, the company — predicted in some fashion circles to be the next Juicy Couture — this year plans to launch an expanded product line that will feature casual sportswear such as denim-related product and woven items, including pants, shirts and skirts.
C & C co-founders Claire Stansfield and Cheyann Benedict will stay with the firm as co-presidents.
The company “is one of the most successful new brands in the contemporary zone, an area we have found to be particularly attractive,” Paul Charron, chairman and chief executive officer of Liz Claiborne, said in a statement,
Charron said the acquisition provides Liz Claiborne with additional channel diversification, and noted that C & C has “significant organic growth potential in its signature T-shirt line and will rapidly evolve into a full lifestyle collection of casual sportswear items. We also feel there are abundant brand extension opportunities in nonapparel categories, as well as in licensing and additional international distribution.”
Frederick Schmitt of investment banking firm Sage Group, which represented C & C in the deal, said its financial structure is an arrangement that Liz Claiborne has used before, including its acquisition of contemporary brand Juicy Couture, also a client of Sage’s.
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