G-III Apparel Buying Donna Karan for $650 Million

DKNY-LOGONEW YORK & PARIS — G-III Apparel Group, a leading designer, manufacturer and marketer of branded clothing and accessories, has agreed to acquire Donna Karan International, Inc., parent of the Donna Karan and DKNY brands from LVMH Moët Hennessy Louis Vuitton of Paris. G-III will pay LVMH $650 million for Donna Karan and the deal is expected to close in late 2016 or early 2017.

Morris Goldfarb, Chairman, Chief Executive Officer and President of G-III, said, “Donna Karan International is an iconic global fashion company. Its lifestyle aesthetic resonates well with consumers throughout the world. We are excited to build upon its strong foundation as we seek to capitalize on a significant market opportunity. Donna Karan brings increased scale and diversification, while providing incremental growth on top of our portfolio of some of the best fashion brands in the world. We believe we are well positioned to create and sustain additional value for our shareholders, partners, and customers.”

Toni Belloni, Group Managing Director of LVMH, said, “Donna Karan International has a deep heritage, global recognition, and renewed energy. We believe the DKNY brand has a dynamic position in the market, and when G-III approached us about acquiring the brand, we concluded that the time was right and that G-III was the right steward going forward. We are pleased to have reached an agreement with G-III, a company that has the expertise and capabilities to broaden the brand’s distribution and take it to its next level of success. We are grateful to CEO Caroline Brown, creative directors Maxwell Osborne and Dao-Yi Chow, and the entire management and design teams for the strategic actions that created a platform to support DKNY’s continued growth.”

G-III is based in NY and a leading manufacturer and distributor of apparel and accessories under licensed brands, owned brands and private label brands. G-III’s owned brands include Vilebrequin, Andrew Marc, Marc New York, Bass, G.H. Bass, Weejuns, G-III Sports by Carl Banks, Eliza J, Black Rivet and Jessica Howard. G-III has fashion licenses under the Calvin Klein, Tommy Hilfiger, Karl Lagerfeld, Kenneth Cole, Cole Haan, Guess?, Jones New York, Jessica Simpson, Vince Camuto, Ivanka Trump, Ellen Tracy, Kensie, Levi’s and Dockers brands. Through its team sports business, G-III has licenses with the National Football League, National Basketball Association, Major League Baseball, National Hockey League, Hands High, Touch by Alyssa Milano and more than 100 U.S. colleges and universities. G-III also operates retail stores under the Wilsons Leather, Bass, G.H. Bass & Co., Vilebrequin and Calvin Klein Performance names.

G-III plans to fund the acquisition through new indebtedness, $75 million of newly issued G-III common stock to LVMH, and a $75 million 6½ year seller note. In connection with the acquisition, G-III has obtained financing commitments from Barclays and JPMorgan Chase Bank, N.A. for a $525 million ABL credit facility and a $450 million 6-year term loan. The closing of the transaction is not subject to financing conditions.