Byline: Eric Wilson

NEW YORK — Pamela Dennis is spinning off her signature eveningwear collection from Pegasus.
The designer has struck a deal with Pegasus Apparel Group, which bought her company last year, to take control of her signature eveningwear collection as a licensee, while Pegasus will focus on a new joint venture for a lower-priced Pamela Dennis eveningwear line.
In effect, Pegasus is spinning off the first business it bought — Dennis’s high-end collection, where dresses retail upwards of $3,000 — when the company was formed by a group of investment managers to target fashion acquisitions last March.
A spokesman for Pegasus said the new deal, signed between Pamela Dennis LLC and Pamela Dennis, the person, is viewed internally as a positive step for both parties, as it allows Dennis to focus on the part of the business that she is more interested in, which may have limited growth potential, while Pegasus can launch a more accessible collection with greater long-term commercial potential.
But sources close to the companies also said there had been a growing rift between Dennis and Pegasus management and that the new deal was viewed as a means to resolve their conflicting opinions over the direction of the business, particularly the amount of resources being devoted to the lower-end collection. It is planned to launch for resort retailing in a joint venture with Rob Feinberg and Rich Honig, principals of the Kay Unger eveningwear business.
The Pegasus spokesman would only confirm that the company and the designer had reached an agreement in principle for Dennis to license her signature eveningwear collection, beginning with her fall 2001 collection. Pamela Dennis LLC, which is the jointly owned company between Dennis and Pegasus, will oversee completion of the collection’s spring deliveries.
As a result of the deal, Dennis is expected to set up her own company, as licensee, to control the design, production and distribution of her own signature collection. The designer was traveling for a trunk show on Wednesday and could not be reached for comment.
The impending change in the structure of Dennis’s business, will in effect create two distinct companies selling merchandise under Dennis’s name, targeted at two segments of the market — her own collection with red-carpet worthy prices and the lower-priced joint venture, which is breaking into a somewhat less-populated segment of the eveningwear category with price points about twice those of the average bridge resource.