EXCLUSIVE: US: Tommy Hilfiger to merge North American operations
Fashion and lifestyle firm Tommy Hilfiger is merging its operations in the US and Canada, the company confirmed exclusively to just-style on Friday (6 March), in a move that will create a new business unit called Tommy Hilfiger North America.
Some jobs will be lost in the merger, a spokesperson for Tommy Hilfiger confirmed this morning. "A few staff positions will be made redundant but it is close to nothing," he said.
The changes come after a review of Tommy Hilfiger's operations identified synergies between the two units which have both shifted their focus onto their retail businesses in recent years.
The new consolidated business will be headed by Gary Sheinbaum, group president of North American Retail.
Colleen Kelly, group president of North American Wholesale, will oversee US and Canadian wholesale activities.
Sheinbaum and Kelly will continue to report directly to Fred Gehring, CEO of the Tommy Hilfiger Group.
Once the integration is complete in June 2009, Howard Starr, CEO of Tommy Hilfiger Canada, will resign.
The changes come after a period in which the Amsterdam-based luxury firm has been expanding its retail business in Canada where it operates more than 50 retail locations.
Under Tommy Hilfiger North America, the Montreal office will remain the Canadian corporate office with regional offices in Toronto and Vancouver.
"The unprecedented economic crisis around the world has led us, like all other companies, to review the business structure and identify areas of consolidation and efficiency," said Fred Gehring in a statement mailed to just-style.
"The business profiles of Tommy Hilfiger USA and Tommy Hilfiger Canada have many parallels, including a recent shift to a primarily retail business, creating an opportunity to maximize alignment and synergy.
"The integration is in line with our strategy to consolidate brand management and enhance our international presence by approaching markets in a globally coordinated effort."
Tommy Hilfiger has been making a major push to expand its retail presence in the US, and is seeing significant growth from its partnership with Macy's - which has been the exclusive department store retailer of its men's and women's sportswear since last autumn.
In its most recent financial update, the firm, which is owned by private equity firm Apax Partners, said its US sales rose 16.7% to $356m in the six months to 30 September. US same-store sales were up 6.0%. However, sales in Canada were 1.9% below last year.
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