Texas Firm Owned by Hunt Family Member Offers $22 Per Share for Phillips-Van Heusen
Phillips-Van Heusen, the shirt maker that became one of the country’s largest apparel manufacturers, said Friday that a company owned by Texas multimillionaire Caroline Hunt Schoellkopf has made an unsolicited $22-per-share takeover bid.
Phillips-Van Heusen said its board will consider the all-cash offer from Rosewood Financial, which owns 19.7% of the New York company’s 15 million shares outstanding, after it is reviewed by the company’s financial and legal advisers.
Phillips-Van Heusen, which was founded in 1859 as Phillips Jones Co. by the current chairman’s great-grandfather, makes a broad line of shirts, sportswear and other clothing.
The company recently agreed to sell its tailored clothing subsidiary and its specialty retail chains--including the 19-store Harris & Frank chain, which is based in Los Angeles--to the management of those businesses. Phillips-Van Heusen retained its 89 PVH Outlet off-price stores.
Famous Pitchman
Undoubtedly the company’s most famous pitchman was then-actor Ronald Reagan, who in 1953 appeared in an advertisement for Van Heusen Century shirts, proclaiming: “The neatest Christmas gift of all!”
Phillips-Van Heusen bears little similarity to the other investments of Caroline Hunt Schoellkopf, who, with a fortune estimated at $875 million by Forbes magazine, is one of the nation’s wealthiest women. Schoellkopf, the 63-year-old sister of five other wealthy Hunts--Nelson Bunker, W. Herbert, Lamar, Haroldson and Margaret Hunt Hill--tends to put her money in real estate, oil, gas and hotels, including the luxurious Bel-Air Hotel.
Rosewood Financial, which has been accumulating Phillips-Van Heusen stock for two years, apparently decided to make the takeover offer after it decided a stock buyback proposed by Phillips-Van Heusen management was not in the best interests of all company shareholders, according to documents filed Friday with the Securities and Exchange Commission.
If successful in its so-far-friendly takeover attempt, Rosewood Financial would pay about $267 million for the portion of Phillips-Van Heusen it does not already own. The offer, which expires on July 20, is conditioned on Rosewood obtaining financing for the bid and reaching employment agreements with “key personnel” of Phillips-Van Heusen.
“Our proposal provides (Phillips-Van Heusen) shareholders with an immediate opportunity to realize on (the company’s) potential,” Rosewood President Mark W. Hobbs said in a letter to directors that was delivered at a meeting Thursday with Phillips-Van Heusen Chairman Lawrence S. Phillips.
“I hope you are as enthusiastic about this proposal as we are,” Hobbs said.
Wall Street, for one, responded enthusiastically, pushing the price of Phillips-Van Heusen’s stock up $5.125 to close at $24.875 on the New York Stock Exchange.
‘Reflects Conjecture’
“I think that reflects the conjecture that the bid might be sweetened or a competing bid might be sweeter,” Eileen Gormley, an analyst with Thomson McKinnon Securities, said. Investors also might be betting that Phillips-Van Heusen may be considering a leveraged buyout, an idea investigated and abandoned by the company last year, she said.
A hostile takeover of Phillips-Van Heusen could be difficult because management owns 16% of the company’s stock and employee pension and stock plans hold another 10%, said Liz Armstrong, an analyst with Johnson Redbook Service.
PHILLIPS-VAN HEUSEN AT A GLANCE
New York-based apparel manufacturer produces a variety of items including shirts, slacks, pajamas, coats, suits and sportswear. Products are sold under various brand and designer names including Van Heusen, Corum, Cacharel and Halston.
Year ended Jan. 31 1987 1986 1985 Sales (millions) $514 $550 $591 Net income (millions) 20.1 15.9 15.3
Assets (1986) $241 million
Employees 7,300
Shares outstanding 15 million
12-month price range $15-$20.25
Friday close (NYSE) $24.875, up $5.125
