DESIGNER HOLDINGS: WE’RE IN TALKS WITH WARNACO ONLY

NEW YORK — Designer Holdings isn’t talking to any other prospective suitors while it works out a definitive agreement to be acquired by The Warnaco Group.
In a statement issued Wednesday by the parties, it was pointed out that Designer Holdings and its controlling shareholder, New Rio, in agreeing to an extension to Friday for the completion of a definitive agreement with Warnaco, also agreed to extend a no-shop agreement.
As part of the agreement in principle on an acquisition offer at $11 a share in Warnaco stock, Designer Holdings had agreed not to solicit other proposals or enter into negotiations with anyone other than Warnaco pending a definitive agreement.
Warnaco stock closed Wednesday at 34 1/4, off 1/8, and Designer Holdings eased 1/16 to 9 11/16 on the New York Stock Exchange.
Designer Holdings, which has a $470-million-a-year Calvin Klein jeanswear business and a 40-year extendable license for the product, could be an attractive target for other acquisitive suitors as well as Warnaco, industry sources have pointed out. Warnaco itself is already a potent player in the Calvin Klein franchise, ringing up sales last year of $302.4 million with its Calvin Klein men’s underwear and accessories and women’s intimate apparel.
In noting on Tuesday that the timing to complete a definitive agreement was being extended to Friday, Linda J. Wachner, Warnaco chairman and president, stated, as reported, that the additional time was “not about negotiations; it’s about finishing a massive amount of paperwork.”
The agreement in principle for the acquisition was announced on Sept. 17.

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