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G-III Apparel to Add Donna Karan & DKNY to its Portfolio
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New York-based G-III Apparel Group, Ltd. (GIII - Free Report) has inked a deal with French luxury-goods conglomerate, LVMH Moët Hennessy Louis Vuitton to acquire the latter’s subsidiary, Donna Karan International, Inc., for $650 million. The deal, which is expected to conclude either in late 2016 or early 2017, will bring leading brands Donna Karan and DKNY under the ambit of G-III Apparel.
G-III Apparel plans to finance the deal through new debt, via a $75 million common stock issued to LVMH and a $75 million 6 1/2 year seller note. Additionally, the company reached financial deals with Barclays and JP Morgan Chase Bank regarding a $525 million ABL credit facility and $450 million term loan extending for 6 years.
G-III Apparel currently has to its credit leading brand names like Vilebrequin, Andrew Marc, Marc New York, Bass, G.H. Bass and Weejuns. Additionally, it has licenses for Calvin Klein, Tommy Hilfiger and Karl Lagerfeld among others. The company expects the addition of the DKNY and Donna Karan brands to not only boost its portfolio of brands, but also offer financial leverage, allowing it to explore incremental market opportunities.
While G-III Apparel expects the deal to weigh on its financial results in fiscal 2018, it anticipates generating profits thereafter. Also, the designer and marketer of apparel and other sportswear items plans to keep its financial guidance intact until the completion of the acquisition.
Sources revealed that LVMH’s Donna Karan division was not performing well since the last 12−18 months. It had started losing sheen due to its African-based outfits. Consequently, this acquisition may prove to be profitable for the French conglomerate.
Zacks Rank
Currently, G-III Apparel carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the retail sector include Christopher & Banks Corporation , sporting a Zacks Rank #1 (Strong Buy), PVH Corp. (PVH - Free Report) and Hanesbrands Inc. (HBI - Free Report) , both carrying a Zacks Rank #2 (Buy).
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G-III Apparel to Add Donna Karan & DKNY to its Portfolio
New York-based G-III Apparel Group, Ltd. (GIII - Free Report) has inked a deal with French luxury-goods conglomerate, LVMH Moët Hennessy Louis Vuitton to acquire the latter’s subsidiary, Donna Karan International, Inc., for $650 million. The deal, which is expected to conclude either in late 2016 or early 2017, will bring leading brands Donna Karan and DKNY under the ambit of G-III Apparel.
G-III Apparel plans to finance the deal through new debt, via a $75 million common stock issued to LVMH and a $75 million 6 1/2 year seller note. Additionally, the company reached financial deals with Barclays and JP Morgan Chase Bank regarding a $525 million ABL credit facility and $450 million term loan extending for 6 years.
G-III Apparel currently has to its credit leading brand names like Vilebrequin, Andrew Marc, Marc New York, Bass, G.H. Bass and Weejuns. Additionally, it has licenses for Calvin Klein, Tommy Hilfiger and Karl Lagerfeld among others. The company expects the addition of the DKNY and Donna Karan brands to not only boost its portfolio of brands, but also offer financial leverage, allowing it to explore incremental market opportunities.
G-III APPAREL Price
G-III APPAREL Price | G-III APPAREL Quote
While G-III Apparel expects the deal to weigh on its financial results in fiscal 2018, it anticipates generating profits thereafter. Also, the designer and marketer of apparel and other sportswear items plans to keep its financial guidance intact until the completion of the acquisition.
Sources revealed that LVMH’s Donna Karan division was not performing well since the last 12−18 months. It had started losing sheen due to its African-based outfits. Consequently, this acquisition may prove to be profitable for the French conglomerate.
Zacks Rank
Currently, G-III Apparel carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the retail sector include Christopher & Banks Corporation , sporting a Zacks Rank #1 (Strong Buy), PVH Corp. (PVH - Free Report) and Hanesbrands Inc. (HBI - Free Report) , both carrying a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>