Nanette Lepore has finally said “I do.”
The contemporary sportswear designer has agreed to sell majority ownership of her brand to Bluestar Alliance LLC, marking the industry’s first merger and acquisition deal of the new year.
The two parties have been negotiating on and off since 2013. Bluestar and Lepore were introduced by The Sage Group LLC, a Los Angeles-based investment banking boutique, which initiated the transaction. The parties declined to reveal the terms of the deal, which is expected to close today.
Lepore, 51, said it was time to take her 22-year-old business to the next level. “With Bluestar’s international expertise, we look forward to expanding the Nanette Lepore brand worldwide,” she said. The designer expects the venture agreement will generate greater exposure for the brand through licensing new categories, marketing, and opening stores domestically and internationally. Lepore and her husband, chief executive officer Robert Savage, will have majority ownership of her core ready-to-wear business.
“We love Nanette,” said Ralph Gindi, managing partner and chief operating officer of Bluestar. “We think she’s very relevant today. It’s a stellar brand and fits into our current portfolio. We have all the right teams in place.” Bluestar will own the intellectual property of Lepore’s name, together with Lepore and Savage. Bluestar owns the majority of the business, but Lepore “owns a good piece of it,” Gindi said.
He said Lepore wanted to take her time before she found the right partner. “We believe she’s an integral part of the business. We’re buying into that. She’s keeping her entire operational team.
“We were dating,” he said, addressing the time it took to complete a deal. “You have to get to know each other. Everybody has different goals and aspirations, and you have to make sure there’s a meeting of the minds.”
Known for her bold colors, lively prints and feminine silhouettes, Lepore is a strong proponent of the Save the Garment Center movement. Her efforts to protect New York City’s Garment Center have helped raise awareness and demand for American-made clothing.
Erwin Isman, managing director of MMG Advisors, who served as the financial adviser to Lepore in the deal, said, “The new strategic partnership between Nanette Lepore and Bluestar Alliance will expand the branding footprint of the Nanette Lepore name. Nanette Lepore and Bob Savage will continue to manage the core company, while Bluestar focuses on brand development and extensions. Our projections call for continued growth in all areas.”
According to Gindi, the goal is to build Lepore “into a lifestyle brand,” and add such categories as intimate apparel, home, fragrance, handbags and footwear. He said some of these products have been part of her collection, but now they will be developed more fully through licensing. “A lot of designers like to build it themselves, but we find best in class and the right partners who will work with the designers. One company can’t handle it all. We want to dress the Nanette customer from head to toe with sunglasses, optical, outerwear.…She [Lepore] didn’t focus on those categories. Now she has a partner willing to spend the time to do it,” Gindi said. “We do believe she resonates internationally. Bluestar will get her name known around the world.
“Within 24 to 36 months, we’ll have full brand representation,” he added.
Bluestar is a brand management firm founded in 2007 by Joseph Gabbay, ceo, and Gindi. It is a closed equity fund with $250 million of committed capital. The partners own, manage and market a portfolio of consumer brands that include Catherine Malandrino, Kensie, Mac & Jac, Yak Pak, Joan Vass, Kooba, English Laundry and Harvé Benard. Bluestar’s strategy is to build brands and consumer recognition through licensing programs. Since its inception, Bluestar has acquired brands with current retail sales exceeding $1.5 billion. The current portfolio of brands manages more than 200 licensees who distribute product worldwide.
Born in Youngstown, Ohio, Lepore started the business in 1992 with a $5,000 loan from her father. She was inspired by her arty bohemian childhood and passion for a good party. She began with a small shop in the East Village and would produce clothing in several small factories in the garment center. Today, the company sells to retailers including Neiman Marcus, Bloomingdale’s, Saks Fifth Avenue, Nordstrom and Macy’s. Lepore’s designs are worn by such celebrities as Michelle Obama, Nicki Minaj, Taylor Swift, Abigail Breslin, Sofia Vergara, Patricia Clarkson and Arianna Huffington. New York’s first lady, Chirlane McCray, wore the designer’s Skyscape coat to meet the Duchess of Cambridge last month.
The company, whose products include sportswear, swimwear, accessories and home furnishings, has stores in New York; Las Vegas; Bal Harbour, Fla., and Boston, as well as 11 units in Japan. The designer also has a junior line at J.C. Penney called L’amour Nanette Lepore. Lepore has a home furnishings deal with Peking Handicraft, which makes the designer’s bedding, gift pillows and rugs.