Liz Claiborne Acquires Juicy Couture Brand
Liz Claiborne Inc. has been a relentless shopper over the last four years.
On Tuesday, the New York-based apparel maker snapped up the Los Angeles-based Juicy Couture brand of expensive casual duds, adding yet another designer label to its collection of women’s attire that ranges from loungewear to silk power suits.
Financial terms weren’t disclosed. Privately held Juicy Couture raked in $47 million last year selling $160 terry-cloth warmup suits and $44 T-shirts that have become popular with some of Hollywood’s most-photographed celebrities.
With Liz Claiborne providing the financial, organizational and operational infrastructure, Juicy Couture can “grow as high and far as we want it to,” said Gela Taylor, who along with Pamela Skaist-Levy founded the company in 1994. Today it sells its wares in 840 high-end specialty outlets and about 280 department stores. Both will remain with Liz Claiborne as co-presidents of the Juicy Couture unit.
“We feel excited and proud to have partnered with a great fashion house,” Taylor said.
Since 1999, Liz Claiborne has been trying to branch out to all segments of the women’s retail market. The company bought designer labels such as Ellen Tracy, Laundry and Lucky Brand jeans. At the same time, the firm is selling its moderately priced labels such as Russ and Axcess at Wal-Mart, Kohl’s and Kmart stores, among other chains.
“With its appeal to a more fashion-conscious and affluent consumer, Juicy Couture adds another dimension to our portfolio, further broadening our ability to offer apparel and accessories across a wide range of consumer lifestyles and tastes,” said Paul Charron, Liz Claiborne chairman and chief executive, in a statement.
The diversity of its apparel lines has helped boost sales. Liz Claiborne has had 28 consecutive quarters of sales growth. In the latest quarter ended Dec. 28, net income rose 40% to $58 million, or 58 cents per share, on sales of $994 million.
Liz Claiborne shares closed Tuesday at $29.98, down 21 cents, on the New York Stock Exchange.
The stock has nearly doubled since 1999.
Competitors also are seeking to diversify their brands. Jones Apparel Group Inc., for instance, has acquired more moderate-priced clothing brands, including LEI and Gloria Vanderbilt, said Roz Bryant, an analyst with Chicago-based Morningstar Inc.
“I see Liz Claiborne diversifying along age lines,” Bryant said. “Liz Claiborne is going after designer names, and Juicy seems to be on the cusp of whatever is fashionable. That’s not the same approach Jones is taking, which doesn’t necessarily mean it’s a bad thing.”
Angela Ahrendts, senior vice president and group president for Liz Claiborne’s modern brands, said Juicy Couture fills a niche market -- described by its founders as “casual luxury” -- with opportunities to expand more into men’s and baby wear.
Juicy Couture launched a men’s wear line this spring, available in a few stores. The company also makes baby clothes and a collection of jeans.
Yet it is Juicy’s tracksuits, which include a $426 cashmere version, that are a hit in the fickle world of fashion trends.
Our clothing represents “an L.A. lifestyle,” Taylor said. “It’s affordable luxury right now.”