LOS ANGELES — Today marks one month since Juicy Couture became the latest member of Liz Claiborne Inc.’s fast-expanding portfolio, and the founding pair who revolutionized the track suit — and the very idea of casual luxury — are sitting pretty inside their headquarters 30 minutes north of Los Angeles proper, in the dusty, industrial area of Arleta.

Pam Skaist-Levy and Gela Taylor, who remain co-presidents with Claiborne’s 100 percent acquisition of the six-year-old company, which tallied 2002 sales of $47 million, talk with a headiness of the latest turn in their lives. The two are juggling media inquiries, considering appointments with licensees and reviewing everything from sneakers and scents to hosting their own TV show as their cult brand begins to evolve into a global lifestyle powerhouse under the auspices and clout of Liz Claiborne.

"When most businesses get ready to sell, they just want to pocket the cash and move on to something else," Taylor said.

"We got to a point with all these things we started adding to our line, from flip-flops to fur parkas, and we just wanted a sugar daddy to help finance what we want to do," picked up Skaist-Levy, finishing the thought, as the two are wont to do.

"And that sugar daddy is Paul Charron," they simultaneously declare of Claiborne’s chairman and chief executive officer, who made Travis Jeans Inc., Skaist-Levy’s and Taylor’s founding company that owns the assets to Juicy Couture, number 31 in Claiborne’s relentlessly growing empire.

Analysts, including Wells Fargo Securities’ Jennifer Black, are estimating the deal to total no more than $98 million, according to an initial cash payment Claiborne made of $39 million, including assumption of a $4 million debt for its acquisition of Travis Jeans Inc., according to a Form 8-K filed April 9 with the Securities and Exchange Commission.

Yet Juicy’s camp is pushing the figure higher.

"Our sense is it will be in excess of $100 million overall," said Mark Vidergauz, managing director for the Sage Group, which brokered the deal on Travis’ behalf. "That’s $50 million up front, and the $50 million to $70 million on the back end. There’s no cap, so really the sky’s the limit."Claiborne also indicated the purchase price for Travis Jeans requires a contingent payment equal to 30 percent of Juicy’s equity value to be determined as a multiple of its earnings for 2005, 2006 or 2007. Either party has the option to select the measurement year for the contingent payment, yet if 2005 is selected, Claiborne expects the contingent payment will be $45 million to $55 million. Juicy is expected to realize accretive earnings per share by some 2 cents in the third and fourth quarters of 2003.

Ellen Tracy, Lucky Brand, Sigrid Olsen and Laundry are among the brand acquisitions Claiborne has made with department store distribution since its spree began in 1999. Its moderate lines such as Axcess and Russ sell at Kohl’s, Wal-Mart and other chains.

Such diversification has contributed to the company's 28-consecutive quarters of sales growth. Fourth-quarter net income rose 40 percent to $58 million on sales of $994 million. Claiborne's 2002 sales were up 11.1 percent to $3.45 billion, while income rose 4 percent to $192.1 million.

"The mantra internally is business as usual," said Angela Ahrendts, Liz Claiborne Inc. executive vice president and group president for the firm’s modern brands. "Any time we do an acquisition of this type, it’s not about buying something because it’s broken. They have an unbelievable vision and have filled a great niche in the market. One of the biggest problems up to this point is supplying the demand. But the goal is not to overdistribute Juicy in America."

In the U.S., Juicy is sold in 840 specialty stores, from Fred Segal in Los Angeles to Scoop in New York, and 280 department stores, including Bloomingdale’s, Neiman Marcus, Bergdorf Goodman and Barneys. Europe, which accounts for 8 percent of the company’s total sales, recently had the opening of a Juicy boutique in London’s Harvey Nichols. The remaining 7 percent of nondomestic sales is split between Canada with 5 percent and Asia with 2.

"The number one issue has been getting a great flow of goods on a timely basis," said Ahrendts. "If we just fulfill the demand alone, you can imagine the growth. At their current speed, it’s feasible they can double their business in a year and that has nothing to do with [Claiborne] at all."Retailers are looking forward to guaranteed deliveries and a wider array of Juicy product.

"The fact that everything’s going to get done on time is huge," said John Eshaya, women’s buyer for Ron Herman-Fred Segal and one of the first to carry Juicy. "If anything, the deal helps improve the line and deliveries — not that I’ve ever had issues with deliveries."

Yet even with preferential treatment, delivered orders usually don’t fulfill the demand.

"We never have enough Juicy," said Erica Berge, owner of Erica D in Corona del Mar, Calif., who reports 100 percent sell-throughs and an ongoing waiting list. "If I had an entire store of nothing but Juicy, I’d do really well."

Cosmetics, fragrance, footwear, handbags and the first namesake boutique top Juicy’s short list in the coming months. With the licensees will come increased production overseas and not "Made in the Glamorous U.S.A." which has been a boast on hangtags — until recently, with the "huge" cashmere production in China.

"We will keep doing as much as we can locally," said Taylor.

Juicy has a staff of 200 in its already squeezed 27,000-square-foot headquarters.

The pair envision a world of goods that will eventually include a home collection. Skaist-Levy already has begun designing furniture for her own house, which she shares with her husband, producer-director Jeff, and their two-year-old son, Noah.

While studying at the Fashion Institute of Design & Merchandising here, Skaist-Levy turned a millinery project into a line called Helmet, whichsold briefly at Barneys New York and Fred Segal. Meanwhile, Taylor got her drama degree at Carnegie Mellon University in Pittsburgh, followed by roles in the original Broadway production of "Zoot Suit," and later to TV with "Taxi," "Hill Street Blues" and other shows.

They met in 1994 at friend Tracey Ross’ Sunset Plaza shop and soon hooked up to launch a maternity jeans line named Travis Jeans, after Taylor’s son, the first of her three children. In 1996, they transitioned into curvy V-neck T-shirts and launched Juicy Couture. Juicy Jeans followed in 1999, with Taylor’s husband, John, and his seminal band, Duran Duran, reuniting for the launch party, which attracted Hollywood’s A-listers who’ve boosted the phenomenon of the brand.But it wasn’t until spring 2001 that the look that would launch a cult bowed. The idea behind the tracksuit was chic comfort.

"I wear Juicy all the time because it’s good for everything, in sneakers or high heels. It’s my uniform," said rap star Eve last week, who recently announced plans for her own apparel line.

"The tracksuit isn’t going away," said retailer Ross. ‘Even separate pieces are being worn with a Chanel jacket or mixed up in other ways."

Today, women’s accounts for 90 percent of sales, with the remaining 8 percent in men’s and 2 percent of baby business seen as potentially lucrative arenas. Down Dog Couture Yoga launched this past February at a house party attended by Debra Messing, Rebecca Romijn- Stamos, Brooke Shields, Jessica Capshaw and many other celebrity fans.

"Is going with LCI and growing going to get more difficult to design and keep up?" asked Skaist-Levy. (She and Taylor insist on hipping up the Claiborne name by rechristening the company LCI.) "We don’t think so. We design what we want and that’s never going to change."

Taylor added: "A challenge for us will be keeping the department stores at bay. We don’t want to see a sea of Juicy everywhere as we grow. We have great partnerships at many department stores, but we’re also very boutique driven. It’s going to be about keeping the department stores happy and making sure our vision is there."

They consider the flood of tracksuits by other brands good for business, even "validating the category," noted Skaist-Levy. After all, even J.Lo has been widely photographed wearing Juicy, although her Hilfiger-backed brand offers its own version.

Despite market trends toward catering to a plus-size youth customer, Juicy only recently inched up to a size 8 and is reluctantly considering a 10 to quiet retailer requests.

Skaist-Levy said, "We have no interest in doing the teen or tween market. We want to remain aspirational. Those little girls have to grow up to be able to have Juicy or steal it from mom. It was never geared toward them. Gela and I are really petite, so we made small clothes."Still, they are aware that teens are shelling out $140 for their terry tracksuits, or $130 for their jeans.

The pair, along with their new parent, are also doing some aspiring of their own.

"The world, even Seventh Avenue, is interested in the casual chic of West Coast style, Taylor said. "We want Juicy to become the next big American brand."

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