Iconix Brand Group Inc. said Wed-nesday that it formed a joint venture with a unit of the Falic Group to expand its licensing in Latin America.
In addition, Iconix said Target Corp. renewed its license for the Mossimo brand for another two years.
The Latin American operation, called Iconix Latin America, will focus on expanding the firm’s licensees in the region, which number 16, and maximizing royalty revenues in Mexico, Central America, South America and the Caribbean that are estimated at $4 million annually. Falic’s New Brands Americas LLC unit paid $6 million and made other commitments for a 50 percent interest in the joint venture. Florida-based Falic is owned by Simon, Jerome and Leon Falic.
“The Falic brothers have extensive expertise and contacts in the Latin American market,” said Neil Cole, chairman and chief executive officer of New York-based Iconix. “Having locally based partners with knowledge of the different cultures and markets that comprise this region will significantly accelerate the growth of our brands throughout this territory and help us maximize revenue from our existing licensing base in Latin America.”
Iconix’s other international joint venture, formed in May, is in China and is expected to make investments and provide Iconix brands to local operating companies. By contrast, the Latin American business, Cole said, “will be run as a traditional licensing business with near-term revenue opportunity.”
Silas Chou’s Novel Fashion Holdings invested $20 million in Iconix China while Iconix contributed $5 million and the rights to Iconix’s brand portfolio, which includes Op, Mudd, London Fog, Joe Boxer, Candie’s, Bongo and Badgley Mischka in addition to Mossimo and other labels.
Todd Slater, analyst at Lazard Capital Markets, said that, because Falic owns Duty Free Americas Inc., the largest duty free operation in the Americas, “we believe this deal could create further opportunities for Iconix’s brands through Falic’s 150 points of distribution.”
Falic owns several fashion and cosmetics brands, including the House of Christian Lacroix and Urban Decay, and has worldwide rights to the Perry Ellis brand for fragrances and cosmetics. In addition, it distributes luxury and upscale brands including Gucci, Bulgari, Hermès, Christian Dior and Guess.
The Mossimo-Target licensing direct-to-retail licensing arrangement is set to run until Jan. 31, 2012. Mossimo was an independent firm when, represented by Cherokee Inc., it initially licensed Target in 2000, the first in a series of designer alliances with mass merchants.