Byline: Valerie Seckler

NEW YORK — Fashionmall is in the hunt for dot-com game and is targeting both fashion and entertainment players.
“We are in talks with three parties regarding a possible acquisition,” revealed Ben Narasin, chief executive officer of Inc. “We have moved into an aggressive acquisition mode.”
Although he declined to identify those parties, Narasin told WWD they included companies that focus on selling filmed entertainment and digital video discs, or upscale fashion, as well as one providing regional and city style guides online.
Web sites selling footwear and decorative home goods are also on Fashionmall’s radar screen, he said, but added the company is not currently negotiating with parties in that sector.
When asked how a dot-com that has yet to turn a profit since going public in May 1999 expects to snap up some of the virtual bargains that have materialized in the stock market’s volatility, Narasin pointed out that Fashionmall can dip into the $37 million it had on its balance sheet at the end of the first quarter.
Fashionmall isn’t likely to be using its own stock as currency in any near-term deals, though, as the issue recently has been trading near its 52-week low.
Shares of Fashionmall added 1/16 to close at 2 15/32, in Nasdaq trading Thursday. During the past 52 weeks, the stock has ranged as high as 15 7/8 and as low as 2.
“It’s the last player left standing in any arena, including Internet fashion, that’s the winner, no matter how bloodied,” the Fashionmall chief observed.
Earlier this year, Fashionmall eyed dot-coms such as Boo and Beautyscene for possible purchases, Narasin related, but he said he was turned off by the prices asked for the value he perceived.
However, with the long anticipated dot-com shakeout gathering momentum, Narasin said the timing for deal-making by smaller players, like Fashionmall, now is far more favorable.
The roster of dot-com casualties this year, as noted, includes fashion players Boo, and CyberShop.
Plus, in January, merged with, was acquired by, Beautyscene changed hands in March and just last month, Net incubator Idealab reportedly spent more than $50 million for a controlling stake in
“Financing for business-to-consumer Web sites — whether from venture capitalists or the public markets — is drying up,” Narasin stated. “There are a lot of bargains out there now.”
Narasin, who founded Fashionmall in 1994, said he received a wakeup call of sorts “a few Fridays ago,” when he was contacted by a few companies that were scouting a merger or acquisition partner.
“Usually, those calls have come from prospective tenants [of],” Narasin noted. “Now, we’re starting to hear from potential acquisition partners.”
As for Fashionmall’s own fiscal status, the firm, based in midtown Manhattan, saw its net loss widen to $2.8 million, or a loss of 38 cents a share, for the first quarter ended March 31, from a year-ago net loss of $46,000. It had 7.5 million common shares outstanding at the end of the most recently completed quarter, up from 4.5 million shares a year earlier. Fashionmall’s first-quarter sales surged 71 percent, totaling $1.32 million, against $770,000 in the prior-year period.
According to Narasin, Fashionmall is expecting to move into the black either by the fourth quarter or by the first quarter of 2001.
Also on Fashionmall’s agenda, its chief executive said Thursday, is a new strategy to develop third-party services such as e-mail marketing, as a complement to its fashion portal, which enables e-commerce. operates a vertical fashion portal at that combines an online shopping mall with fashion content to provide a site where retailers, manufacturers, catalogers and magazines can display, sell and advertise their products. It went live online in 1995. The mall’s tenants include Alloy, Esprit, Steve Madden, Coach, Brooks Bros.; Dolce & Gabbana,, Mudd Jeans, Origins,, Banana Republic, Gap and Old Navy.
“A lot of [click-and-mortar] e-tailers are encumbered by their efforts to [execute] online,” Narasin said. “Their value is the power of their brand and the people that it brings. We’re looking to unleash their potential online.”