Blog: What’s next for Kellwood?
Leonie Barrie | 13 February 2008
After five months of wrangling, Sun Capital has finally bought Kellwood. The private equity group today said its affiliate, Cardinal Integrated LLC, has acquired about 82% of Kellwood’s shares – giving it ownership of the struggling apparel maker. Kellwood will now be merged into Cardinal and become a wholly-owned subsidiary of the company.
The private equity firm, which first expressed interest in buying Kellwood last September, has so far said very little about its plans to rejeuvenate the business. All we know is that it is “prepared to commit substantial resources beyond the purchase price to build Kellwood's business,” and “develop its branded portfolio.”
Which isn’t a world away from the strategy that Kellwood was already pursuing.
The company’s management last year come up with a own turnaround plan based on reducing its exposure to private labels and repositioning the business so that 50% to 70% of its revenues would come from its higher-end lifestyle brands like Vince and Hollywould.
In January it sold its Smart Shirts shirt-making business to Youngor Group for $120m, and said it wanted its own retail operations to grow from 8% to 20% of sales.
It even consolidated divisions, trimming its women's sportswear business from seven to three operating divisions in a bid to make the organisation more agile, improve speed to market, and cut costs.
Aside from more cost cutting and consolidation – both of which are easier to do as a private rather than a public company – it’s hard to see what more the new owners can do.
And with stonger, more powerful competitors like Liz Claiborne and Jones Apparel Group also struggling to find ways to shore up their own businesses, despite having a roster more powerful brands than Kellwood, the prospects for success must look challenging, to say the least.
Confirmation that digital supply chains are top of mind for apparel industry executives came last week with the latest plans from global sourcing specialist Li & Fung....
As a barometer of the issues top of mind for apparel sourcing executives, it is hard to beat the annual Prime Source Forum in Hong Kong. ...
Over the past month, Donald Trump and his team failed to offer any clear plan to ensure Americans would "Buy American, Hire American" - while the British government's attempts to clarify the specifics...
The Bangladesh government was forced to respond late last week to pressure over its crackdown on labour activists after a number of global brands and retailers, including H&M and Inditex announced pla...
- Why collaboration is key to fashion supply chains
- Rana Plaza four years on – Timeline of change
- Industry groups reaffirm commitment to Bangladesh
- Trump and Brexit get a dose of pragmatism
- Using worker surveys to drive supply chain change
- Adidas to digitalise Speedfactory concept
- Nike filed patent for "reinforced denim"
- M&S extends sourcing deal with Lindsey brothers
- US Q1 in brief – Columbia Sportswear, Amazon
- Lenzing unveils new sustainability strategy
- Global market review of denim and jeanswear – forecasts to 2022
- When Things Go Wrong - A Practical Guide to Managing Common Problems in Apparel Sourcing
- Clothing Market in the Top 5 American Countries to 2021 - Market Size, Development, and Forecasts
- Outdoor performance apparel 2016: A broader perspective
- Southeast Asia strategic sourcing review – a focus on Cambodia, Vietnam and Myanmar