Warnaco buys Calvin Klein licenses

The Warnaco Group Inc has agreed to purchase the licenses and corresponding wholesale and retail businesses for a number of Calvin Klein operations from Italian Fingen SpA for €240 million (£163.4 million). The deal is expected to be completed in the first quarter of 2006. The acquisition includes the Calvin Klein Jeans and accessories license for Europe and Asia and the ck Calvin Klein bridge sportswear and accessories license in Europe for 40 years. Furthermore, Warnaco will take over the global Calvin Klein Collection apparel and accessories license from Fingen between 2008 and 2013.

President and CEO of Warnaco, Joseph Gromek: “By far, the Fingen businesses that we are acquiring were at the top our list. For us, this was a very strategic move. It completes our company in terms of the Calvin Klein aspects. We are focusing on our core competencies, which is manufacturing jeans.” Calvin Klein Jeans is expected to generate sales of approximately $240 million in Europe and Asia in fiscal 2005.

The Kellwood Corp license for the Calvin Klein women's better sportswear line will not be affected by the deal. Neither will G.A.V.'s license for the ck Calvin Klein bridge sportswear business. Warnaco already had the rights to Calvin Klein underwear and has the US license for the Calvin Klein Jeans label. The addition of the new licenses is expected to help boost sales.

“We always like to have as many businesses within one licensee as we can,” said Tom Murry, president and COO of CKI. “It makes it easier to coordinate. From a strategic and a distribution standpoint, it's very advantageous.”

www.warnaco.com
22 December 2005

Fresh start for Warnaco

The New York-based Warnaco Group Inc. which makes clothing under brands including Speedo, Calvin Klein and Chaps by Ralph Lauren, said on Tuesday it has emerged from bankruptcy after eighteen months. Its shares will be listed on the Nasdaq. In a news release the company closed on a 275 million USD exit financing facility. The initial draw on the facility was 39m USD.

The Warnaco Group now has 247m USD of debt, compared with the 2.45 billion USD of debt it had before it filed for bankruptcy in June 2001, and its continuing to search for a permanent chief executive and chief financial officer as well as a board of directors. Acting president and CEO, Tony Alvarez, said: "We are extremely pleased to exit Chapter 11. Today, Warnaco is beginning life as a new company with a solid capital structure, greatly reduced debt, disciplined and improved operations, a strengthened management team and an incredible portfolio of brands."

Wachner became the first woman to run a Fortune 500 company when she took over Warnaco in a hostile leveraged buyout in 1986. Under her stewardship, Warnaco evolved from a struggling 425 million clothing company to a top maker of designer brands. But the company suffered as department stores, one of the main outlets for its products, lost market share to discounters in the late 1990s. Warnaco shares, worth 44.44 USD in 1998, traded for less than half a cent on Tuesday.

February 7, 2003