The Irvine, Calif.-based fashion brand, which has been majority owned by Vestar Capital Partners since 1999, has hired investment bank Rothschild to look for suitors, WWD has learned.
Known for its fiercely loyal following, the brand is positioned at the opening price point of the designer market and is no doubt trying to catch some of the fire ignited by Michael Kors Holdings Ltd.’s initial public offering in December. The Kors stock sale, which has given the company a current market capitalization of about $7.7 billion, has designer companies of all stripes pondering their own valuations.
Vestar, which declined to comment Wednesday, has already held St. John much longer than the five to seven years that is typical for a private equity firm. The search for a buyer has been going on for six to eight weeks, sources said. Rothschild also declined to comment.
The Gray family, which founded the brand in 1962, sold Vestar a controlling interest for $520 million and retained a minority stake for itself.
The company’s earnings before interest, taxes, amortization and depreciation — a key metric when valuing a firm for a buyout — are said to be stable. St. John is understood to have about $400 million in annual revenues, wholesaling to Saks Fifth Avenue, Nordstrom and Neiman Marcus, and operating about 26 of its own freestanding stores. International sales represent about 20 percent of the firm’s revenues, with further opportunities seen in Asia, Europe, Russia and the Middle East.
“We’re in the process of turning the business around,” said chief executive officer Glenn McMahon last year. “This is a very significant business, and it’s been a very methodical turnaround. This is an evolution and a transformation of the brand that we began in earnest four years ago, when I joined the company. We’re pleased with the progress we’re making.”
Ralph Toledano was named chairman of St. John in August, a position he continued to hold after becoming president of Puig’s fashion division.
The spring collection had a Seventies feel with tailored blazers, slouchy trousers, long sweater dresses, knit gowns and sexy, long-sleeve floor-sweeping knit dresses.
In 2006, the company, under then-ceo Richard Cohen, famously tried to update its image too fast, signing a multimillion-dollar deal with Angelina Jolie, causing outrage among many steadfast customers.
The brand is a favorite of the power set in Washington, where its professional styling and domestic production are not apt to stir political problems.
Robert E. Gray, who started the firm 50 years ago with his wife, Marie, died in February at 86. He was chairman and ceo of the company until 2002. His wife and their daughter Kelly, who at one time was the face of the brand, pulled back from the company’s day-to-day activities in 2007. They now act as marketing and design consultants.
Should St. John find a buyer, it would be the latest fashion brand to benefit from the boom in M&A activity this year. The deal market has been hopping despite the glacial pace of the U.S. economic recovery, slower growth in China and acute political and economic troubles in Europe.
London’s newly opened @designmuseum will look back on the life and work of Azzedine Alaïa in a show that the designer helped to curate before he died of heart failure last month. The retrospective, which Alaïa had worked on with Mark Wilson, chief curator of the @groningermuseum, will look at the impact of his work worldwide. The show, “Azzedine Alaïa: The Couturier,” will run from May 10 to October 7. Read more about the exhibit on WWD.com #wwdnews #wwdfashion (📷: @zefashioninsider)
@Pharrell and his wife Helen Lasichanh were among the stars that came out to celebrate @rimowa’s first pop-up concept shop. The space, which is located on Rodeo Drive in Beverly Hills, draws inspiration from airport luggage carousels and lounge areas – and features the company’s luggage and accessories. If the pop-up is successful it could pave the way for addition temporary shops throughout the world. #wwdfashion (📷: Owen Kolasinski/BFA)
@carineroitfeld celebrated @crfashionbook’s first calendar last night with a dinner party at Spring Place in Manhattan. Photographed by @stevenkleinstudio, the calendar takes on a fitness theme and features @joansmalls, @gigihadid, @danielle_herrington_ – pictured here – and more. “[Carine Roitfeld] wanted me to feel sexy and she wanted me to be myself and feel it out on my own and do what I felt was right,” said Herrington, aka Miss October. #wwdeye
@saintrecords and @virgilabloh last night at @americanexpress’ “A Night With Success Makers” event. “I always bring it back to community because without that I wouldn’t have the courage,” said Knowles when asked how she has gotten where she is now. Read more highlights from their conversation on WWD.com. #wwdeye (📷: @lizdoupnik)
This Just In: Industry sources have told WWD that Anastasia Soare is rumored to be considering selling her beauty business, @anastasiabeverlyhills. According to those sources, Soare has tapped investment bank Imperial Capital to explore sale options for her eponymous beauty brand –– and with at least $340 million in net sales, this would be a big deal. Put in context of other recent transactions for makeup companies, Soare’s price tag could be in the billions if she were to sell the whole thing. #wwdnews #wwdbeauty (📷: @clint_spaulding)
@assouline’s latest book, “The Spirit of Bentley: Be Extraordinary” captures the adventurous attitudes and opulent lifestyles of @bentleymotors’ most creative owners and enthusiasts throughout the U.K. The 292-page hardcover has a section dedicated to showing its team of skilled artisans and photos of its most colorful owners, from George Bamford to designer @alicetemperley, pictured here by Aline Coquelle. #wwdeye
@google released its report on the most popular search terms this year. For fashion brands, the list was led by @gucci, the luxury brand that stunned the market last October when it pledged to stop using fur. Runner ups were @supremenewyork and @fashionnova, along with more established brands like @louisvuitton, @chanelofficial and @ysl. #wwdfashion (📷: @aitorrosasphoto)
In yet another fashion show shuffle, @elleryland is moving its show in sync with the Paris couture calendar — though the brand is still keeping one foot on the city’s ready-to-wear schedule. Their runway show in January will coincide with the launch of a new strategy: designing two main collections each year instead of four, which will then be released in four drops. “As we all know, the system needs to change. We need to show sooner to give time back to artisans and designers to do what they do best — create,” said founder Kym Ellery. #wwdnews #wwdfashion (📷: @kukukuba)
@maxmara’s classic 101801 coat was the cornerstone of its pre-fall 2018 collection. The design team expanded the traditional double-breasted, kimono-sleeved style into a trapeze coat, lean belted styles and a peacoat and presented them in monochromatic looks – like the camel one pictured here. #wwdfashion #prefall18 (📷: George Chinsee)