Calvin Klein women’s jeans officially have a new home.
PVH Corp. and G-III Apparel Group Ltd. have finally forged their licensing deal for G-III to design, produce and distribute Calvin Klein’s women’s jeanswear collections for the U.S. and Canada. The arrangement is for an initial term of five years.
This business joins the other women’s Calvin Klein businesses that are already licensed to G-III by Calvin Klein Inc., including women’s ready-to-wear, accessories, outerwear, swimwear and dresses in North America.
The arrangement is expected to support PVH’s strategy to build a successful women’s jeanswear business in North America by leveraging G-III’s category and market expertise. The first women’s Calvin Klein Jeans collection is being introduced for the spring 2020 season.
Wall Street reacted positively to the deal. PVH’s shares rose 3.01 percent to $87.75, while G-III’s shares were up 0.23 percent to $25.79 in Monday’s trading.
“G-III has been a great partner for us over the years and has successfully grown the Calvin Klein women’s wear business to be a leading resource across the North American apparel market. We look forward to our expanded partnership with G-III, as this represents another great opportunity to leverage their market expertise to drive the continued expansion of the Calvin Klein women’s apparel categories,” said Emanuel Chirico, chairman and chief executive officer of PVH Corp.
Morris Goldfarb, chairman and ceo of G-III, said, “We have an incredible relationship with PVH and the Calvin Klein team. They have done an outstanding job managing and marketing the Calvin Klein brand and we look forward to further developing this iconic global brand and building a profitable women’s business for Calvin Klein Jeans in the U.S. and Canada.”
G-III, which has been a savior for Calvin Klein, has healthy distribution in major department stores and reportedly generated about $1.2 billion in wholesale volume for its Calvin Klein products last year.
It is understood the European Calvin Klein Jeans line would remain with CKI, and would continue to be designed out of Amsterdam, where sibling brand, Tommy Jeans are produced. Both Tommy Hilfiger and Calvin Klein are divisions of PVH. In January, CKI said it planned to consolidate operations for its men’s Calvin Klein Sportswear and Calvin Klein Jeans business.
Elaborating on the move, Chirico told WWD that G-III “has done a terrific job with our overall women’s business for CK and for Tommy for North America, and it just made sense for them to operate the business at this point in time.” Chirico confirmed that CKI will continue to operate its women’s jeans business directly outside of North America, and will operate its Calvin Klein Jeans men’s business directly in North America. “We believe G-III is the best possible partner to grow the Jeans women’s business into a lifestyle business beyond denim bottoms,” Chirico said.
For years, Calvin Klein Jeans, which were established in 1978, had been a leader in the designer denim category and became well-known for its provocative advertising. Warnaco Group originally got the license for Calvin Klein Jeans in 1997. In 2012, PVH acquired Warnaco for $2.9 billion, which included the then-troubled Calvin Klein Jeans and Underwear businesses. During its first few years under Klein and PVH, the integration was difficult and CKI needed to clean up distribution and reinvigorate the jeans line with improved fit and innovative design.
As reported, when PVH released third-quarter results in November, Chirico said there was a weak response to the Calvin Klein Jeans’ re-branding. He said the relaunched Calvin Klein product under former chief creative officer Raf Simons was too elevated and did not sell through as well as had been planned and called in a “fashion miss.” The line had emphasized utility, pop-inflected irreverence, color blocking, patchwork denim, big logos and a theme Simons had pushed at Calvin — Americana.
Last week when PVH released its first-quarter results, Chirico discussed the impending G-III deal.
“We shook hands,” said Chirico, referring to his deal with Goldfarb. “The lawyers are still playing around with some wording. I think that will all be behind us. Shortly, that deal is done. They’re showing product. They’re actually talking about building spaces in certain key department store doors with new shops-in-shop. We really feel good about how strong their product presentations to the department store channel have been,” Chirico said. “The reception of the product at retail has been extraordinary.”