A Sigh of Relief WWD Women’S Newspaper Daily •December1,2008$2.00 Wear Retailers’ •The Daily Full Weekend Coverage,Seepages8to10
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▲ ▲ NEWS: ▲ FASHION: Jacobs FASHION: Stella launching Stephen Lagerfeld’s McCartney Sprouse-inspired silent fi lm names accessories and rtw homage Frederick for Vuitton, page 7. to Coco Lukoff Chanel, president, ▲ SECTION II: page 5. ceo, Jewelry & page 4. Watch Report. WWDWomen’s Wear Daily • The Retailers’MONDAY Daily Newspaper • December 1, 2008 • $2.00 Accessories/Innerwear/Legwear A Sigh of Relief Retailers breathed just a bit easier after Black Friday traffi c and sales exceeded their fearfully modest expectations. Shoppers were lured out of hibernation holiday by discounts of unprecedented proportions, certain to take a bite out of fourth-quarter profi ts. For ’08 full weekend coverage, see pages 8 to 10. Black Friday bargain hunters on Fifth Avenue. PHOTO BY KYLE ERICKSEN KYLE PHOTO BY 4 WWD, MONDAY, DECEMBER 1, 2008 WWD.COM Saks Gets Defensive as Slim Ups Stake By Evan Clark as it’s battled escalating losses, shrinking sales and lower credit ratings. WWDMONDAY Accessories/Innerwear/Legwear SAKS INC. SAW A POISON PILL PLAN AS THE Slim, through companies he oversees, fi rst best remedy for the combined symptoms of a low took an interest in Saks in March 2000 when his stock price and an aggressive investor. Orient Star investment company snatched up GENERAL The embattled luxury retailer established a 7 percent stake. Retail was familiar territory 1 Retailers went into Black Friday weekend with a preferred share purchase program last for Slim, who already controlled 86 percent of lowered expectations and came out with a Wednesday — one that kicks in when a single Sanborn department store parent Grupo Sanborn sense of relief. investor acquires 20 percent or more of its stock and an 85 percent stake in Sears in Mexico. — just days after Mexican billionaire Carlos Slim After Slim bought Sears’ Mexican operations, 4 Saks Inc. took defensive measures last week Helú boosted his stake in the fi rm to 18.3 percent. analysts said the deal made sense for Slim’s Grupo against a single investor owning more than 20 In his own filing with the Securities and Carso, which was seen as a turnaround specialist percent of its stock. Exchange Commission, Slim certifi ed that the that bought undervalued companies. “Sears was a 5 Karl Lagerfeld’s glamorous, big-budget, silent shares “were not acquired and are not held for the classic turnaround company for Carso to buy,” an short fi lm about Coco Chanel’s early years is purpose of or with the effect of changing or infl u- analyst said at the time. “It was at the bottom of premiering in Paris on Wednesday. encing the control of the issuer of the securities.” the retail cycle and losing money.” That may provide scant comfort to Saks, which In March, Forbes estimated Slim’s fortune at $60 7 Louis Vuitton creative director Marc Jacobs said in its SEC fi ling on the poison pill plan, “The billion, between Warren Buffett and Bill Gates. is paying homage to Stephen Sprouse with a board of directors has authorized the adoption of In an interview on his offi cial Web site, Slim special collection of accessories and ready- a rights agreement to protect shareholders from was asked why he started buying companies dur- to-wear. coercive or otherwise unfair takeover tactics. ing Mexico’s 1982 fi nancial crisis. 11 Cosmetix West is stepping out from behind the In general terms, the rights impose a signifi cant “It all collapsed, the trust of investors, the private label curtain with its own personal care penalty upon any person or group which acquires rate of exchange, and of course, prices,” he said. and home fragrance brand, Infusion Organique. benefi cial ownership of 20 percent or more of the “All this, led to these inexplicable, punished company’s outstanding common stock without prices of very valuable companies that did not 15 ACCESSORIES: Watchmakers and jewelers the prior approval of the board of directors.” have fi nancial problems.” are fi nding a new avenue to sell their wares Slim ranks as the world’s second richest man Much of that should sound familiar to inves- — and it’s not Madison — it’s the cyber and amassed his business empire, in part, by ac- tors in today’s market, which is characterized by highway. quiring companies on the cheap during Mexico’s a banking crisis and extremely low stock prices. LEGWEAR: From zip-up leather pieces to 1982 fi nancial crisis. Slim on his Web site also lists his 10 business ▲ 16 Inmobiliaria Carso, a trust controlled by the principles in talking about his Grupo Carso busi- complicated sheer confections, edgy legwear family of Slim, owned 25.3 million shares of Saks ness. Among them are: a simple business struc- designs popped up all over the designer as of Nov. 24, boosting its ownership interest by ture with minimal hierarchies, austerity, a focus market for spring. 3.3 million shares in less than a week, according on modernization and cooperation and, number Jewelry & Watch Report is included as a to fi lings with the SEC. Saks had 137.7 million 9, “All times are good time[s] for those who know Section II in this issue. shares outstanding as of Nov. 1. how to work and have the tools to do so.” Classifi ed Advertisements...........................................................................................18-19 Investors pushed shares of the fi rm up 12.4 The souring fortunes of luxury shoppers have TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS percent Wednesday after the so-called poison pill hurt all the high-end chains. Saks also is stuck [email protected], USING THE INDIVIDUAL’S NAME. was established. The stock continued to rise in with a cumbersome debt load, although analysts WWD IS A REGISTERED TRADEMARK OF ADVANCE MAGAZINE PUBLISHERS INC. COPYRIGHT ©2008 an abbreviated session on Friday, ascending an- said the company could always tap the inherent FAIRCHILD FASHION GROUP. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A. other 7.8 percent to $4.31, well below the issue’s value locked away in its real estate, particularly VOLUME 196, NO. 114. WWD (ISSN 0149–5380) is published daily (except Saturdays, Sundays and holidays, with 52-week high of $22.19, but 61.4 percent above the the landmark Fifth Avenue fl agship. one additional issue in January, October and December, two additional issues in March, April, May, June, August and November, and three additional issues in February and September) by Fairchild Fashion Group, which is a division 52-week low of $2.67 established on Nov. 21. For the quarter ended Nov. 1, Saks posted a of Advance Magazine Publishers Inc. PRINCIPAL OFFICE: 750 Third Avenue, New York, NY 10017. Shared Services Saks said it would distribute a preferred share loss of $42.8 million on a 12.3 percent drop in provided by Condé Nast Publications: S. I. Newhouse, Jr., Chairman; Charles H. Townsend, President/CEO; John W. purchase right on Dec. 8 for each outstanding sales as the fi rm’s women’s apparel business was Bellando, Executive Vice President/COO; Jill Bright, Executive Vice President/Human Resources. Periodicals postage share of the company’s common stock. The right laid low by “widespread weakness.” The compa- paid at New York, NY, and at additional mailing offi ces. Canada Post Publications Mail Agreement No. 40644503. Canadian Goods and Services Tax Registration No. 886549096-RT0001. Canada Post: return undeliverable Canadian would only be exercisable if a person or group ac- ny said its spring receipts are planned down by addresses to: P.O. Box 503, RPO West Beaver Cre, Rich-Hill, ON L4B 4R6 POSTMASTER: SEND ADDRESS CHANGES quires 20 percent or more of the company’s stock. at least 15 percent. TO WOMEN’S WEAR DAILY, P.O. Box 15008, North Hollywood, CA 91615–5008. FOR SUBSCRIPTIONS, ADDRESS Each right will entitle shareholders, other “It’s the toughest environment I have seen in CHANGES, ADJUSTMENTS, OR BACK ISSUE INQUIRIES: Please write to WWD, P.O. Box 15008, North Hollywood, CA 91615-5008, call 800-289-0273, or visit www.subnow.com/wd. Please give both new and old addresses as printed than the acquiring entity, to buy one one-hun- my career,” Stephen I. Sadove, Saks’ chairman on most recent label. First copy of new subscription will be mailed within four weeks after receipt of order. Address all dredth of a share of Series C junior preferred and chief executive offi cer, said at the time. editorial, business, and production correspondence to WOMEN’S WEAR DAILY, 750 Third Avenue, New York, NY 10017. stock. If a person or group of investors acquires Asked about the company’s liquidity, Sadove said For permissions and reprint requests, please call 212-630-4274 or fax requests to 212-630-4280. Visit us online at www.wwd.com. To subscribe to other Fairchild magazines on the World Wide Web, visit www.fairchildpub.com. 20 percent of Saks’ common stock, each right he was “very comfortable with our fi nancial situa- Occasionally, we make our subscriber list available to carefully screened companies that offer products and services will allow the rest of the fi rm’s shareholders to tion” with its $500 million revolving credit facility that we believe would interest our readers. If you do not want to receive these offers and/or information, please purchase a number of Saks’ common shares that and a New York fl agship that’s “unencumbered.” advise us at P.O. Box 15008, North Hollywood, CA 91615-5008 or call 800-289-0273. WOMEN’S WEAR DAILY IS NOT RESPONSIBLE FOR THE RETURN OR LOSS OF, OR FOR DAMAGE OR ANY OTHER INJURY TO, UNSOLICITED MANUSCRIPTS, have a market value of twice that of the exercise Still, Saks is among the most fi nancially pres- UNSOLICITED ART WORK (INCLUDING, BUT NOT LIMITED TO, DRAWINGS, PHOTOGRAPHS, AND TRANSPARENCIES), OR price, thereby diluting the acquirer’s position.