December 8, 2019

DealBook: Liz Claiborne Sells Namesake Brand, Monet to J.C. Penney

William L. McComb, left, the chief of Liz Claiborne, at Juicy Couture's promotion for Fashion's Night Out in 2009.Lisa Lake/Getty Images for Juicy CoutureWilliam L. McComb, left, the chief of Liz Claiborne, at Juicy Couture’s promotion for Fashion’s Night Out in 2009.

Liz Claiborne continues to clean out its closet of brands.

The women’s apparel maker on Wednesday announced the sale of its namesake brand and Monet to J.C. Penney, with Bluestar Alliance buying Kensie. The transactions, along with the recent sale of its Dana Buchman brand to department store Kohl’s, will generate $328 million in cash proceeds, the company said.

“Over the past few years, we have worked diligently to turn this into a more efficient, dynamic, brand-centric, retail-based company, and today marks the culmination of these efforts,” William L. McComb, the head of Liz Claiborne, said in a statement. “At the close of these transactions, at a time when most economists in the world are now agreeing that major European and the U.S. markets are facing significant risks of another recession, we will be a more appropriately levered, more capital efficient, growth-oriented company.”

Liz Claiborne has been on a campaign to shed its brands and licenses in an effort to cut its debt load.

In August, the company sold a group of fragrance licenses to Elizabeth Arden for $58.4 million. Then in September, it offloaded Mexx, a young women’s apparel brand, to a joint venture led by buyout firm the Gores Group. Under the terms of the sale, Liz Claiborne received $85 million and a minority stake in the joint venture. On Wednesday, the company also announced that it has terminated its licensing agreements with Donna Karan International, one year early. The recent string of transactions is expected to reduce its debt to $270 to $290 million by the end of this year, the company noted in its statement.

With the loss of its namesake brand, the retailer also said it will rebrand itself with a new corporate name that reflects its remaining, flagship brands: Juicy Couture, Lucky Brand and kate spade. The trio, a group of labels focused on young women’s fashion, have been strong performers for Liz Claiborne’s portfolio. Though Juicy Couture noticed a small dip in same-store sales in September, Lucky Brand recorded a 24 percent increase; sales at kate spade, which caters to a wealthier demographic, more than doubled, gaining 114 percent. The company hasn’t not announced a new name.

Article source: http://feeds.nytimes.com/click.phdo?i=8042cc22e505ad48a6500a4e587572a3