Hartmarx Announces Agreement to Acquire Womenswear Maker Exclusively Misook, Inc.
June 28 2004 - 9:01AM
PR Newswire (US)
Hartmarx Announces Agreement to Acquire Womenswear Maker
Exclusively Misook, Inc. Acquisition Expected to Contribute $.12 -
$.15 to Fiscal 2005 Earnings Per Share CHICAGO, June 28
/PRNewswire-FirstCall/ -- Hartmarx Corporation (NYSE:HMX) today
announced that it has entered into a definitive agreement to
acquire the business of Exclusively Misook, Inc., a designer and
marketer of upscale women's knit products sold through leading
specialty stores. Homi B. Patel, president and chief executive
officer of Hartmarx, commented, "We are truly excited about having
Exclusively Misook as part of the Hartmarx family. Misook is the
leading designer of very fine luxury knits catering to the busy
woman executive. Each Misook garment is custom-cut individually by
hand, meticulously sewn and hand-pressed, providing for a very
long-lasting, high quality product. This acquisition fits in
perfectly with our "best of class" strategy. The brand also has an
exceptionally loyal following among its core consumers and we see
significant long-term opportunities for high quality line
extensions, licensing and international sales. We are very pleased
that Misook Doolittle, founder and designer, has agreed to continue
as president under a five-year employment agreement. So as to
maintain its uniqueness, Exclusively Misook will operate as an
autonomous business and a free-standing operating unit of
Hartmarx." "With this acquisition, our annualized women's segment
revenues will exceed $100 million and will enable us to accomplish
our long-term goal of a 50/50 split between men's tailored and
non-tailored categories much sooner than originally anticipated.
Misook's annualized operating results are expected to contribute
approximately $35 million in sales and $.12 - $.15 to Hartmarx
earnings per share in fiscal 2005. This all cash acquisition will
be financed almost entirely from internally generated cash
utilizing the availability under our current Senior Credit
Facility," Mr. Patel concluded. The terms of the transaction call
for a cash payment at closing of $30 million subject to certain
post-closing adjustments. Additional contingent amounts would be
payable over a five-year period if specified earnings levels are
achieved. The acquisition, which is subject to customary closing
conditions, including Hart-Scott-Rodino approval under the United
States anti-trust laws, is expected to close during July. Misook's
management team will continue to report to Misook Doolittle. Misook
Doolittle added, "Our business has grown very rapidly and we were
looking for a partner that would help take us to the next level. We
are very pleased to be associated with a company like Hartmarx that
is not only dedicated to high quality garments, but understands the
great value of product differentiation. Our affiliation with
Hartmarx going forward will best enable us to expand our product
offerings and achieve our sales and earnings growth objectives."
Kurt Salmon Associates Capital Advisors, Inc. acted as exclusive
financial advisor to Exclusively Misook in connection with this
transaction. Hartmarx produces and markets business, casual and
golf apparel under its own brands including Hart Schaffner Marx,
Hickey-Freeman, Palm Beach, Coppley, Cambridge, Keithmoor, Racquet
Club, Naturalife, Pusser's of the West Indies, Royal, Brannoch,
Riserva, Sansabelt, Barrie Pace and Hawksley & Wight. In
addition, the Company has certain exclusive rights under licensing
agreements to market selected products under a number of premier
brands such as Austin Reed, Tommy Hilfiger, Kenneth Cole, Burberry
men's tailored clothing, Ted Baker, Bobby Jones, Jack Nicklaus,
Claiborne, Pierre Cardin, Perry Ellis, Andrea Jovine, Lyle &
Scott and Golden Bear. The Company's broad range of distribution
channels includes fine specialty and leading department stores,
value-oriented retailers and direct mail catalogs. The comments set
forth above contain forward-looking statements made in reliance
upon the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements can
be identified by the use of forward-looking terminology such as
"anticipate," "believe," "continue," "estimate," "expect,"
"intend," "may," "should" or "will" or the negatives thereof or
other comparable terminology. Forward-looking statements are not
guarantees as actual results could differ materially from those
expressed or implied in such forward-looking statements as a result
of certain factors, including those factors set forth in Hartmarx's
filings with the Securities and Exchange Commission ("SEC"). The
statements could be significantly impacted by such factors as the
level of consumer spending for men's and women's apparel, the
prevailing retail environment, the Company's relationships with its
suppliers, customers, licensors and licensees, actions of
competitors that may impact the Company's business, possible
acquisitions and the impact of unforeseen economic changes, such as
interest rates, or in other external economic and political factors
over which the Company has no control. The reader is also directed
to the Company's periodic filings with the SEC for additional
factors that may impact the Company's results of operations and
financial condition. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
DATASOURCE: Hartmarx Corporation CONTACT: Erin Gaffney of Hartmarx
Corporation, +1-212-840-4771 Web site: http://www.hartmarx.com/
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