NEW YORK — Keystone Holdings LLC, an acquisitions company headed by Nicholas DeMarco, has purchased its first apparel company: Hartstrings Inc., a children’s clothing and accessories firm based in Strafford, Pa., that does in excess of $60 million.

This story first appeared in the June 26, 2002 issue of WWD. Subscribe Today.

The purchase price was not disclosed.

Hartstrings was established in 1977 by Peggy Hart Earle and makes children’s, baby and newborn apparel under the Hartstrings, k.c. Parker and Kitestrings labels. Hartstrings distributes its children’s wear through 1,350 specialty stores, and the company owns 21 outlet stores.

Keystone Holdings was founded last year by DeMarco, chairman and chief executive officer; Paul E. Palmeri, director of mergers and acquisitions, and Mathew J. Bruderman, director of investment banking.

DeMarco said Hartstrings’ management team will stay on under contract for a minimum of three years.

According to DeMarco, Keystone’s acquisition targets are profitable companies and branded niche businesses that have a strong potential for growth and category expansion.

Prior to starting this business, DeMarco was president, chief executive and a board member at Halston. Before that, he was president of International Apparel Marketing Corp., a division of Delta Woodside Industries, and a master licensor of the Duck Head and Nautilus trademarks. Earlier in his career, he was director of Pierre Cardin USA, overseeing North American business.”

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