Blog: Leonie BarrieApparel acquisitions see an upswing

Leonie Barrie | 8 May 2012

After the warmer weather and early Easter helped US apparel retailers to higher same-store sales in March, it was perhaps not surprising there would be a slowdown in April. Add in tough comparisons with the same month last year, which was in turn boosted by a late Easter, and it's easy to see why many US retailers fell short of expectations.

But retailers, private equity firms and even manufacturers are also making the most of the uncertain environment to boost their portfolios - with a number of acquisitions over the past week led by plans to buy Collective Brands in a deal worth $2bn. A consortium made up of Wolverine Worldwide and private equity firms Blum Capital Partners and Golden Gate Capital are to buy the parent of Payless ShoeSource in an agreement that will split the shoemaker.

Other deals will see women's wear retailer Ascena Retail Group acquire plus-size apparel specialist Charming Shoppes for US$890m. While T-shirt and sock maker Gildan Activewear is buying apparel manufacturer Anvil Holdings for US$88m and German lingerie group Schiesser AG has cancelled its IPO after being sold to Israel-based intimate and seamless apparel maker Delta Galil for EUR68m (US$90m).

Meanwhile, for sporting goods giant Nike Inc there is a new focus on labour and sustainability standards when it comes to choosing and evaluating the factories making its products around the world. The Sourcing & Manufacturing Sustainability Index is currently being rolled out across Nike's global supply chain - and the firm wants all its suppliers to meet the increased standards by 2020.

The Indian government is to allow cotton exports again, after a decision last week reversed nearly two-months of restricted shipments from the country. However, the situation is set to be reassessed in a couple of weeks' time.

And in this month's management briefing, just-style canvasses the views of software experts on the biggest challenges facing the global apparel supply chain in 2012 and the ways technology can help tackle some of these issues. We also ask where firms should be focusing their investments now if they want to remain competitive into the future.


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