- Acquisition Provides Diversification Beyond Fashion Adding Four Iconic
Home Brands - Cannon(R), Royal Velvet(R), Fieldcrest(R) and
Charisma(R) - to its Growing Portfolio
NEW YORK, Sept. 6 /PRNewswire-FirstCall/ -- Iconix Brand Group, Inc.
(Nasdaq: ICON) ("Iconix" or the "Company"), today announced that it has
entered into a definitive agreement to purchase Official Pillowtex, LLC, a
licensing company that owns a large portfolio of home brands including four
primary brands, Cannon, Royal Velvet, Fieldcrest and Charisma and numerous
others home brands including St. Mary's and Santa Cruz. The purchase price
will be $231 million in cash with contingent payments of up to an additional
$15 million in cash based upon the brands surpassing specific revenue targets.
The four primary brands are all currently licensed in the U.S.: Cannon and
Royal Velvet to Li & Fung USA, Fieldcrest to Target Stores and Charisma to
Westpoint Stevens. In the aggregate the four brands are estimated to generate
between $35 and $37 million in 2008 royalty revenue with direct expenses of
between $5 and $7 million, and will be accretive to earnings. Total aggregate
guaranteed royalty revenue for the brands equals approximately $160 million or
approximately 65% of the purchase price.
According to Neil Cole, Chairman and CEO of Iconix Brand Group, "This is a
transformative acquisition for Iconix as our brand portfolio now transcends
the fashion industry with the addition of four iconic home brands. These
brands have a combined three hundred years of history and a level of awareness
and authenticity that few brands in any category can match. We believe that
the home industry is an ideal fit for our first acquisition outside of fashion
as there is a lack of innovative marketing and differentiation among brands. I
believe that our marketing expertise will enable us to maximize the potential
of these iconic brands and realize numerous growth opportunities including
extending their reach into new categories in the home as well as into new
markets around the world and developing some of the additional smaller brands
within the Pillowtex portfolio."
The purchase price for the acquisition will be paid by Iconix in cash. The
acquisition is anticipated to close later this year and is subject to
customary closing conditions including clearance under the Hart-Scott-Rodino
Anti Trust Improvements Act of 1976, as amended.
Iconix Brand Group, Inc. (Nasdaq: ICON) owns, licenses and markets a
growing portfolio of consumer brands including CANDIE'S(R), BONGO(R), BADGLEY
MISCHKA(R), JOE BOXER(R), RAMPAGE(R), MUDD(R), LONDON FOG(R), MOSSIMO(R) ,
OCEAN PACIFIC(R), DANSKIN(R) and ROCAWEAR(R). The Company licenses it brands
to a network of leading retailers and manufacturers that touch every major
segment of retail distribution from the luxury market to the mass market in
both the U.S. and around the world. Iconix, through its in-house advertising,
promotion and public relations agency, markets its brands to continually drive
greater consumer awareness and equity.
Safe Harbor Statement under the Private Securities Litigation Reform Act
of 1995. The statements that are not historical facts contained in this press
release are forward looking statements that involve a number of known and
unknown risks, uncertainties and other factors, all of which are difficult or
impossible to predict and many of which are beyond the control of the Company,
which may cause the actual results, performance or achievements of the Company
to be materially different from any future results, performance or
achievements expressed or implied by such forward looking statements. Such
factors include, but are not limited to, uncertainty regarding the results of
the Company's acquisition of additional licenses, continued market acceptance
of current products and the ability to successfully develop and market new
products particularly in light of rapidly changing fashion trends, the impact
of supply and manufacturing constraints or difficulties relating to the
Company's licensees' dependence on foreign manufacturers and suppliers,
uncertainties relating to customer plans and commitments, the ability of
licensees to successfully market and sell branded products, competition,
uncertainties relating to economic conditions in the markets in which the
Company operates, the ability to hire and retain key personnel, the ability to
obtain capital if required, the risks of litigation and regulatory
proceedings, the risks of uncertainty of trademark protection, the uncertainty
of marketing and licensing acquired trademarks and other risks detailed in the
Company's SEC filings. The words "believe," "anticipate," "expect,"
"confident," "project," provide "guidance" and similar expressions identify
forward-looking statements. Readers are cautioned not to place undue reliance
on these forward looking statements, which speak only as of the date the
statement was made.
Contact: David Conn
Executive Vice President
Iconix Brand Group
Integrated Corporate Relations
SOURCE Iconix Brand Group, Inc.
/CONTACT: David Conn, Executive Vice President, Iconix Brand Group,
+1-212-730-0030; or Joseph Teklits of Integrated Corporate Relations,
/Web site: http://iconixbrand.com //
CO: Iconix Brand Group, Inc.
ST: New York
IN: ADV REA
-- NYTH125 --
9304 09/06/2007 16:01 EDT http://www.prnewswire.com