PHILLIPS-VAN-HEUSEN will buy fashion brand Tommy Hilfiger in a cash and stock deal for about $3bn (£2bn) in a bid to boost its presence in markets like Europe and Asia, it said yesterday.
Tommy Hilfiger is currently owned by private equity firm Apax Partners.
Phillips-Van Heusen – which also owns the Calvin Klein designer brand – expects the deal to boost earnings by 20 cents to 25 cents a share, excluding items, in the current fiscal year.
Chief executive officer Emanuel Chirico said: “Tommy Hilfiger fits all of our acquisition criteria: a strong brand, superior management, highly profitable, immediately accretive to earnings, and focused on international growth.
“This is a unique opportunity to bring together two premier companies, each with iconic brands.”
Phillips-Van Heusen sees annual cost savings of $40m from the deal and expects to close it in the second quarter.
After the deal, Tommy Hilfiger will remain in his role as principal designer and visionary for the brand.
He said: “I look forward to remaining actively involved in the business.
“This is the next phase in the global evolution and expansion of the Tommy Hilfiger brand.”
Philips-Van Heusen’s clothing lines include Calvin Klein, Van Heusen, Arrow, IZOD and Bass.
Philips-Van Heusen also expects to make $40m of cost savings through the deal. Tommy Hilfiger is known for its American casual and sports clothes.
They often feature the preppy look of Ivy League American students. It also sells high-end fragrances and accessories.
City A.M. Reporter