Zip It Inventive Takes on the Black Jacket Surfaced for Couture, in Lace Or Mohair, Sculptural Or Languid
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Page 1 Monday s s s RETAIL: MEN’S: INNERWEAR: J. Crew’s Club A crop of new Millard Monaco innerwear “Mickey” revamps designers, Drexler men’s page 8. bets on wear Madewell ’37s for fall, s NEWS: Kellwood Co. tries jeans, page 3. page 3. to stave off bankruptcy, page 2. Women’s Wear Daily • The Retailers’ Daily Newspaper • July 13, 2009 • $3.00 WwDMONAccessories/Innerwear/LegweardAY Zip It Inventive takes on the black jacket surfaced for couture, in lace or mohair, sculptural or languid. Here, Giorgio Armani injected Eighties glam into a soft tailored wool version with a jeweled zipper for Giorgio Armani Privé. For more on the trend, see pages 6 and 7. A&F Stays on Message With a Global Strategy In Face of Falling Sales By David Moin DESPITE A dRAmATIc SLUmP IN SALES, Abercrombie & Fitch Co. is thinking big and not letting up on its strategy or image-building. The sexual overtones, aspirational product and defiant nonpromotional stance go on vivid display Wednesday with the opening of Manhattan’s first Hollister store in SoHo, the initial flagship for A&F’s mall-based teen chain and a linchpin to the brand’s goal of global growth. It’s the mother ship — four levels and 40,000 square feet — being aggressively marketed as “The Epic Hollister Store.” “Considering the scale of the store, epic seemed appropriate,” said Michael Jeffries, chairman and chief executive officer of Abercrombie & Fitch Co., the parent of the See A&F, Page12 NI o VANNI GIANN VANNI o GI by PHOTO BY BY PHOTO photo 2 WWD, MONDAY, JULY 13, 2009 WWD.COM Kellwood Tries to Head Off Bankruptcy By Vicki M. Young transaction said that Sun recouped most of its investment shortly after its acquisition. Another KEllwOOD CO. EXECUTIVES ARE IN nameplate under the Sun umbrella, Anchor Blue WWDAccessories/Innerwear/LegwearMONDAY round-the-clock talks with financial and legal Retail Group, filed for bankruptcy court protec- advisors in an effort to stave off a Chapter 11 tion in May. FASHION bankruptcy filing. “Since we were taken private by Sun, The black jacket got the tony treatment at Dior, The company, which private equity firm Sun Kellwood has been remarkably profitable,” 6 Chanel and Christian Lacroix. Capital Partners Inc. bought for $762 million in Hunter said. “We’ve shed over $100 million February 2008, has been in talks with its bond- from our expense [structure] with the new GENERAL holders for two months concerning $140 million management team that Sun put in place. We’re On the eve of the first Hollister flagship opening, in notes that mature at midnight on Wednesday. opening new retail stores for our Vince brand. 1 Michael Jeffries, chief executive officer of Abercrombie Sources said the latest negotiations involved From a cash flow standpoint, we’re in a very & Fitch, talks pricing, expansion and the future. exchanging maturing notes for new ones with a good spot.” longer maturity and better terms on the inter- Kellwood has a number of recognizable 3 Mickey Drexler, chief executive officer of J. Crew, est payment. Deutsche Bank, Kellwood’s largest brands in the moderate and better categories. discusses the denim market and Madewell’s bondholder, is said to have balked at jeans launch. supporting the exchange. Adidas by Stella McCartney has tapped Caroline The bank’s position is said to have 3 Wozniacki, the up-and-coming Danish tennis star, taken participants in the talks by as the face of its tennis collection. surprise, including other note hold- ers that back the exchange. Kellwood 3 Under the direction of Timothy Farah, the new had not yet hired bankruptcy coun- vice president of men’s design, Club Monaco is sel, although Chapter 11 seems a widening its fit options and creating a collection of likely option if Deutsche Bank main- tailored clothing, sportswear and furnishings. tains its stance. 8 INNERWEAR: A fresh crop of lingerie designers, Sources familiar with the situation iconic brands and licensees are launching new said it was not likely that parent Sun lines for spring 2010. Capital would step up to the plate and buy out Deutsche Bank’s stake to save 9 ACCESSORIES: The founders of Links of the exchange offer. London have started a new jewelry brand called Eric Hunter, Kellwood senior vice Annoushka, which will launch next month at president for marketing and brand namesake boutiques in British department stores. awareness, said negotiations were under way until midweek “when EYE Deutsche Bank [Kellwood’s largest Kellwood has been opening stores for its Vince brand, like the one Unseasonably chilly temperatures didn’t deter bondholder] said it may not agree to shown here in Beverly Hills. Erin O’Connor in s 4 a fashionable crowd from turning out for the [the proposed] terms.” Donna Karan. Serpentine Gallery’s annual summer bash. Hunter said Friday the company is If the company was forced into Classified Advertisements................................................................................................15 “looking at all options” and “bankrupt- cy is an option.” Hunter pointed out “bankruptcy, there’s no guarantee the TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS that if the firm had to file for Chapter [email protected], USING THE INDIVIDUAL’s NAME. 11, it would be due solely to the ac- bondholders would get back 100 WWD IS A REGISTERED TRADEMARK OF ADVANCE MAGAZINE PUBLISHERS INC. COPYRIGHT ©2009 tions of its largest bondholder and not FAIRCHILD FASHION GROUP. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A. because of business conditions. VOLUME 198, NO. 8. WWD (ISSN 0149–5380) is published daily (except Saturdays, Sundays and holidays, with cents on the dollar. one additional issue in January, May, October, November and December, two additional issues in March, April, June It was unclear why Deutsche Bank and August, and three additional issues in February and September) by Fairchild Fashion Group, which is a division was leaning toward not accepting the — Frederick” Schmitt, Sage LLC of Advance Magazine Publishers Inc. PRINCIPAL OFFICE: 750 Third Avenue, New York, NY 10017. Shared Services proposed terms. The bank did not re- provided by Condé Nast Publications: S. I. Newhouse, Jr., Chairman; Charles H. Townsend, President/CEO; John W. Bellando, Executive Vice President/COO; Jill Bright, Executive Vice President/Human Resources. Periodicals postage spond to a request for comment. Sun paid at New York, NY, and at additional mailing offices. Canada Post Publications Mail Agreement No. 40644503. Capital declined comment. The brands include Phat Fashions, Vince, Canadian Goods and Services Tax Registration No. 886549096-RT0001. Canada Post: return undeliverable Canadian A Sun affiliate, Sun Capital Securities Group, David Meister, Sag Harbor, Koret and Briggs addresses to: P.O. Box 503, RPO West Beaver Cre, Rich-Hill, ON L4B 4R6 POSTMASTER: SEND ADDRESS CHANGES TO WOMEN’S WEAR DAILY, P.O. Box 15008, North Hollywood, CA 91615–5008. FOR SUBSCRIPTIONS, ADDRESS acquired the apparel firm. Kellwood had op- New York. CHANGES, ADJUSTMENTS, OR BACK ISSUE INQUIRIES: Please write to WWD, P.O. Box 15008, North Hollywood, CA posed the unsolicited bid since September 2007. Frederick Schmitt, managing director at in- 91615-5008, call 800-289-0273, or visit www.subnow.com/wd. Please give both new and old addresses as printed on most recent label. First copy of new subscription will be mailed within four weeks after receipt of order. Address all At the time, members of the investment com- vestment banking firm Sage LLC, said there’s a editorial, business, and production correspondence to WOMEN’S WEAR DAILY, 750 Third Avenue, New York, NY 10017. munity were confused by the purchase, since it chance a bankruptcy might be avoided. For permissions and reprint requests, please call 212-630-4274 or fax requests to 212-630-4280. Visit us online didn’t appear to fit the usual Sun profile of buy- “There might be some gamesmanship involv- at www.wwd.com. To subscribe to other Fairchild magazines on the World Wide Web, visit www.fairchildpub.com. Occasionally, we make our subscriber list available to carefully screened companies that offer products and services ing underper- ing the bondholders,” he said. “In this economic that we believe would interest our readers. If you do not want to receive these offers and/or information, please forming firms environment, exchange offers are common. Few advise us at P.O. Box 15008, North Hollywood, CA 91615-5008 or call 800-289-0273. WOMEN’S WEAR DAILY IS NOT in need of a companies have the liquidity to meet debt offer- RESPONSIBLE FOR THE RETURN OR LOSS OF, OR FOR DAMAGE OR ANY OTHER INJURY TO, UNSOLICITED MANUSCRIPTS, UNSOLICITED ART WORK (INCLUDING, BUT NOT LIMITED TO, DRAWINGS, PHOTOGRAPHS, AND TRANSPARENCIES), OR turnaround. ings and many debt providers have to accept lon- ANY OTHER UNSOLICITED MATERIALS. THOSE SUBMITTING MANUSCRIPTS, PHOTOGRAPHS, ART WORK, OR OTHER Some of ger maturities and maybe get something else in MATERIALS FOR CONSIDERATION SHOULD NOT SEND ORIGINALS, UNLESS SPECIFICALLY REQUESTED TO DO SO BY Sun’s acquisi- return. The situation is not unique. WOMEN’S WEAR DAILY IN WRITING. MANUSCRIPTS, PHOTOGRAPHS, AND OTHER MATERIALS SUBMITTED MUST BE ACCOMPANIED BY A SELF-ADDRESSED STAMPED ENVELOPE. tions have not “The most rational option is to extend the panned out. maturity date and hope to get back the full pay- Mervyns, which ment later on over time,” Schmitt said. “If the Cyclical trends and the it acquired from company was forced into bankruptcy, there’s no DAILY Target Corp. guarantee the bondholders would get back 100 headwinds“ we face in the in 2004 along cents on the dollar.” QUOTE with Cerberus While it is unclear how a bankruptcy filing Capital might alter the current ownership of Kellwood, current environment are affecting sales Management, a filing could subject its brands to a poten- Lubert-Adler tial sale, since bankruptcy laws require filers in the short term...but we are confident and Klaff to consider options to maximize value to the Realty, filed for debtor’s creditors.