US: Liz Claiborne buys Mac and Jac for $23.6m
Expansionist apparel group Liz Claiborne has bought Westcoast Contempo Fashions and Mac and Jac Holdings for about US$23.6m, including retirement of debt at closing.
Westcoast and Mac and Jac (collectively known as Mac and Jac) design, market and sell the mac & jac, kenzie and kenziegirl apparel lines.
In addition to the $23.6m purchase price, Claiborne will make additional payments based upon a multiple of Mac & Jac's earnings in financial years 2006, 2008, 2009 and 2010. Mac & Jac generated net sales of approximately $40m in financial 2005.
Claiborne chairman and chief executive Paul Charron commented: "Mac & Jac's strong brand names and multi-brand, multi-channel and multi-geography approach complement our portfolio diversification strategy.
"Mac & Jac is well positioned for significant organic growth through the opportunity for expanded distribution in the US department store and specialty store channels, in addition to further penetration within its existing account base."
Charron continued: "We also are encouraged by the opportunity to expand specialty retail, which is in the early stages of development, as well as international opportunities through additional distribution and further growth in their Asian joint venture.
"Mac & Jac also has abundant brand extension opportunities in non-apparel categories, as well as in licensing."
Mac and Jac founders Eric and Lani Karls, who will continue to lead the company, said: "We are excited to join the Liz Claiborne family and access resources that will enable us to grow our great brands faster.
"We are very impressed by Liz Claiborne's management and their proven track record of acquiring brands and allowing the businesses to reach their full potential."
The acquisition is expected to have a slightly accretive impact on Claiborne's financial 2006 earnings.
Claiborne is in the process of trying to acquire US-based retailer J Jill Group.
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