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Russell-Newman Buys KN Karen Neuburger

Sleepwear firm joins roster of lifestyle brands.

Russell-Newman Inc. has acquired the assets and trademark of KN Karen Neuburger, a women’s and men’s sleepwear and lifestyle brand with licensees in the home accessories and bedding areas.

This story first appeared in the July 28, 2008 issue of WWD.  Subscribe Today.

Financial terms were not disclosed. However, retail sales of Neuburger sleepwear, robes, daywear, signature soft socks and licensees totaled about $250 million in 2007, according to industry estimates.

This is the second acquisition for Denton, Tex.-based Russell-Newman since March, when it purchased St. Eve, a maker of women’s and children’s sleepwear, underwear and daywear.

“We are constantly looking for brands that we can own,” said Jim Martino, chairman of Russell-Newman. “There’s a lot of talk about licensing brands, but we also want to build the equity of the brands we own. We cold-called KN Karen Neuburger and asked them what the situation was, and the timing was right. They wanted to sell and we wanted to buy.

“One of the reasons we were interested in the Karen Neuburger brand was we wanted to be in the better area,” he said. “There are no plans to down-channel the brand.”

Russell-Newman, which generates about $275 million in annual wholesale sales, supplies major retailers and sources with its products from a long-established network in 20 countries. The company creates, manufactures and distributes innerwear and apparel in multiple channels, with brands such as Cypress sleepwear and robes for women, sleepwear and robes for women by Tommy Hilfiger and Laura Ashley, Baby Gro sleepwear for newborns and St. Eve sleepwear for boys and girls. The company also has a hospitality division that makes upscale robes for hotels and spas worldwide.

Regarding opportunities to expand the Karen Neuburger franchise, David Martino, president and chief executive officer of Russell-Newman, said, “Karen Neuburger is well developed in sleepwear, and Cypress and St. Eve will help cross-pollinate the Karen Neuburger product line to be more prominent at retail, and in additional classifications such as robes and daywear.”

Sleepwear by Karen Neuburger, which was created in 1991, is distributed to more than 1,000 major department store doors.

“Karen Neuburger also has a small hospitality division and it will enhance ours as well,” Martino added. “We also see an opportunity to develop a Karen Neuburger children’s [sleepwear] business.”

He added that Dustin Eber will continue as president of the Karen Neuburger operation.�