DKNY Sold ... confirmed by LVMH

[perhydrol]

LVMH confirms DKNY sale.

FOLLOWING reports last week, LVMH has confirmed that it has sold Donna Karan International (DKI) - owner of DKNY - to G-III Apparel Group for $650 million.

"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," said Toni Belloni, group managing director of LVMH, reports WWD.

In spite of the sale, creative directors Maxwell Osborne and Dao-Yi Chow - who continue to run their own brand, Public School - will remain at the label along with CEO Caroline Brown to whom Belloni also expressed his gratitude "for the strategic actions that created a platform to support DKNY's continued growth".

G-III Apparel Group - which currently owns brands including Vilebrequin, Andrew Marc, and Marc New York, and has licensing deals with Tommy Hilfiger, Calvin Klein, and Karl Lagerfeld among others - said that it felt it was well positioned to move the company (founded in 1989 by Donna Karan herself, who departed her namesake labels last year) into its next stage of growth.

"Donna Karan International is an iconic global fashion company," said Morris Goldfarb, chairman, chief executive officer and president of G-III. "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 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."

British Vogue

 

[Benn98]

Why keep these two? Surely they're part of the reason why this brand went down the drain? I'd ditch them in favour of a team like KTZ. My guess is the new owners must be hard up. Still, it'll probably be a reality check for Public School.

 

[Desi]

Although in all fairness 7 months sounds far too little so reap the rewards of a revamp, so maybe Donna Karan left a sinking ship.
.

What is that only like one and a half collections? DKNY became a much more visible brand with them heading the helm. Now to make a few more down market collaborations to place it in the minds of the younger sect and less of a Macy staple.

 

[softgrey]

this is pretty big news...
i missed it because it is buried in this thread...

i think there should be a separate thread about the sale of Donna Karan...
...

 

[softgrey]

personally- i am thrilled to have the company back over the pond and in american hands...
simply because it is such a quintessentially new york brand...

however---
G-III is far from a luxury conglomerate...
i suspect we will see the kind of thing that happened to Helmut Lang...
less luxury and more affordability/accessibility...

which i don't necessarily see as a bad thing at this point in history...

i am not clear on this point...
does the donna karan label/collection exist at all anymore, or is it only DKNY?
have they stopped producing the DK luxury collection?
cause all they talk about here is DKNY...

 

[Spike413]

personally- i am thrilled to have the company back over the pond and in american hands...
simply because it is such a quintessentially new york brand...

however---
G-III is far from a luxury conglomerate...
i suspect we will see the kind of thing that happened to Helmut Lang...
less luxury and more affordability/accessibility...

which i don't necessarily see as a bad thing at this point in history...

i am not clear on this point...
does the donna karan label/collection exist at all anymore, or is it only DKNY?
have they stopped producing the DK luxury collection?
cause all they talk about here is DKNY...

From what I know, Donna Karan Collection was basically dissolved, but it does continue to sell a small amount of their core pieces here and there, but then there's Urban Zen, which is where Donna is involved, and which also sells sort of core lifestyle pieces that are basically the core pieces of the Donna Karan Collection -- drapey jersey, silk separates, artisanal jewelry and stuff like that -- albeit with a more toned down, much less glamorous vibe to it. The bigger licenses still seem to be in place too (hosiery, lingerie, the mass market perfumes). As for who owns which of those two brands, I don't know.

DKNY remains the brand with any real distribution, a runway presence, advertising presence and all of that.

 

[Mutterlein]

personally- i am thrilled to have the company back over the pond and in american hands...
simply because it is such a quintessentially new york brand...

however---
G-III is far from a luxury conglomerate...
i suspect we will see the kind of thing that happened to Helmut Lang...
less luxury and more affordability/accessibility...

which i don't necessarily see as a bad thing at this point in history...

i am not clear on this point...
does the donna karan label/collection exist at all anymore, or is it only DKNY?
have they stopped producing the DK luxury collection?
cause all they talk about here is DKNY...

They closed the collection business down and saw Donna, and all the other lifers at DKNY, out the door. They made a push to jumpstart DKNY but it looks like they decided to not see it through.

G-III now owns it all.

To be honest, DKNY had already moved away from the luxury/higher end contemporary space it used to lead. If I were G-III, I'd invest in trying to get some of that mojo back and make the brand a powerhouse again, which they definitely cannot do by making it overly accessible or commercial. People need to covet DKNY, which means it cannot in any way shape or form appear basic or common, which it is right now.

First step: get some new creative leadership.

 

[softgrey]

thanks for the info guys...

i'd say dkny is now on par with kenneth cole...
in terms of their clout and image...

used to be downtown nyc cool...
now, not so much...

ah well...
end of another fashion powerhouse...

RIP
...

 

[Mutterlein]

thanks for the info guys...

i'd say dkny is now on par with kenneth cole...
in terms of their clout and image...

used to be downtown nyc cool...
now, not so much...

ah well...
end of another fashion powerhouse...

RIP
...

Indeed.

 

[Benn98]

Fashionweekdaily.com wants Costa to replace Public School's spot. The thought never crossed my mind, but I agree with them. He'll come with much needed refinement to this brand.

 

[Benn98]

G-III Apparel Group Q3 growth fueled by wholesale

Daphne Howland@daphnehowland
Dec. 6, 2018

Dive Brief:

• G-III Apparel Group, (whose owned brands include DKNY, Donna Karan, Vilebrequin, Andrew Marc and Marc New York, among others, and whose fashion licenses include Calvin Klein, Tommy Hilfiger, Karl Lagerfeld Paris, Kenneth Cole, Cole Haan, Guess?, Vince Camuto, Levi's and Dockers) on Thursday reported that third-quarter net sales rose 4.7% to $1.07 billion from $1.02 billion in the year-ago period, missing Wall Street's expectations of $1.08 billion.
  
  
• The conglomerate, which designs, sources and markets apparel and accessories under various owned and licensed brands as well as private labels, also reported that net income in the quarter rose to $94 million from $81.6 million a year ago, according to a company press release.
  
  
• The company raised its full fiscal year guidance as a result of its better-than-expected third quarter results. For the period, which concludes next month, G-III now expects net sales of approximately $3.08 billion (up from its previous guidance of $3.06 billion) and net income between $132 million and $137 million (up from its previous guidance of between $125 million and $130 million).

Dive Insight:
During a conference call with analysts, CEO Morris Goldfarb on Thursday emphasized the company's diverse portfolio, saying that its Karl Lagerfeld Paris brand and Tommy Hilfiger brands have strong runway for growth and that its Calvin Klein brand, with the help of partner PVH, continues to resonate with North American consumers.

Its wholesale business is especially strong and was responsible for all of the quarter's growth, he also said, adding that DKNY and Donna Karan items, previously exclusive to Macy's, will expand into more department stores. The company acquired that brand from French conglomerate LVMH two years ago for $650 million. "We've achieved what we committed to with Macy's," he said. "In many discussions with Macy's we mutually agreed an exclusive brand sometimes doesn't need to be. The greater exposure and appropriate distribution [helps] Macy's."

Straight retail sales are struggling, though, and the company is working with landlords to shutter more underperforming doors, according to Goldfarb. "Clearly retail has not performed, it's not a secret," he told analysts. "Quite honestly we're on it, it's not moving as fast as we'd like … [but] we will cure it."

Goldfarb addressed the impact of tariffs, saying the company is working to further diversify its sourcing to countries outside China. Much of the company's handbag and leather outerwear is sourced there, a "much smaller part of our business" representing 7% of net sales, and tariffs will have minimal impact on financial results, he said. "We've built G-III to be a very entrepreneurial and nimble company" able to respond to such headwinds.

According to recent report from Coresight Research, "G-III Apparel Group has the most substantial exposure to China of all the apparel companies" analyzed, with 65% of its products sourced from China, down from 78% in fiscal year 2016.

Retaildive.com