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NEW YORK — Jones Apparel Group Inc. is continuing to expand its portfolio in the contemporary category.

This story first appeared in the February 4, 2010 issue of WWD. Subscribe Today.

After buying a 50 percent stake in Rachel Roy in 2008, the apparel conglomerate has acquired Moda Nicola International LLC, which owns the Robert Rodriguez Collection.

Jones’ plan is to help the Los Angeles-based designer of women’s contemporary sportswear and eveningwear and his business partner and chief executive officer, Nicola Guarna, grow the label deeper in its existing 600 doors, which include Neiman Marcus, Bergdorf Goodman, Saks Fifth Avenue, Nordstrom, Harrods and Holt Renfrew.

According to Jones, the deal is valued at about $28 million, with Jones having made “initial cash payments to the selling members of MNI,” who are to receive future cash payments “upon achievement of certain financial targets set within the agreement.” Last year, MNI generated net revenues of about $17 million.

Rodriguez said he was looking forward to “becoming part of a dynamic organization such as Jones and to working together to develop the brands to their fullest potential.”

The deal started to come together in the fall, when Rodriguez and Guarna met with Wesley Card, president and ceo of Jones Apparel Group, and a group of Jones executives.

“We had a great conversation, and we were very impressed with what they had accomplished and what they showed us,” Card recalled. “We had seen the product, and thought this is a terrific company that is poised for a lot of growth, and we seem to have a great cultural fit, because we really liked them and they seemed like such sharp and solid businesspeople.”

Rodriguez also fit right into an area Jones executives consider an opportunity for growth. “A big white space for us is the luxury department and specialty store,” Card said. “We have a very good designer business there with Rachel Roy and we are very pleased with that and with Rachel, but we are really not penetrated in the contemporary part of that business. We do most of our business in the next tier down, in the major department stores. We really were impressed with what [Rodriguez and Guarna] had accomplished in terms of the number of doors they were in, and the fact that they developed an international business without the kind of financial backing and infrastructure that we can help them with. We thought this is a great opportunity to grow and become more important as a company in that channel over time.”

Rodriguez and Guarna founded the contemporary label in 2003. A graduate of the Fashion Institute of Technology, Rodriguez worked with Marc Bohan and Geri Gerald at Christian Dior. His own label has gathered a celebrity following of sorts, and the likes of Nicole Kidman, Angelina Jolie and Scarlett Johansson have been spotted in his designs. Rodriguez and Guarna have since expanded the line to include Robert Rodriguez Black Label eveningwear and Robbi & Nikki, which focuses on blouses and is expanding with knitwear for fall.

Guarna expects the new owners will help bring the label “to another level.”

“It will give us opportunities in different categories,” Guarna said. “We believe in the Jones culture, and that’s what Robert’s and my decision was based on.

“We are looking into accessories, shoes and handbags. It’s our second season with necklaces, and we want to build that category even more,” Guarna added.

It appears Jones has no plans to start a lower diffusion line for the label. Card said there is much opportunity for growth within existing retail partners, “just by penetrating deeper into those doors with broader assortments, or more depth of assortments behind what’s on the floor,” he said. “The sell-throughs have been very good and we can grow just by better penetration. That is going to be the main focus and there are opportunities for developing other classifications around that.”

While Card declined to give sales projections for the business, he said, “This really has enormous potential, and we have the ability to fund it to make sure Robert and Nicola have the resources to grow [the business] as big as it could be over time,” he said.

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