DK Heads Back To NY for $650 Million
Donna Karan International has just been sold by LVMH for $650 million to G-III Apparel.
More movement abounds in the fashion industry! In the latest episode of business deals moving faster than fashion trends, French luxury group LVMH has completed the sale of ready-to-wear group Donna Karan International to US clothing manufacturer G-III Apparel. While it sounds mildly heartbreaking, rest assured that the American label’s worth has been recognized and valued at $650 million. The label is merely moving house: Donna Karan and the DKNY brands will return to New York, their birthplace in the 1980s.
“Donna Karan International is an iconic global fashion company,” said Morris Goldfarb, CEO of G-III, which owns the Calvin Klein and Tommy Hilfiger labels so it is no stranger to American fashion labels and is, arguably, even better place than LVMH to make a go of this. “Donna Karan brings increased scale and diversification to G-III, which will finance the transaction with debt and issuing $75 million in new stock to LVMH.”
This move isn’t completely out of the blue, however. Despite steps taken towards restructuring Donna Karan in a bid to boost its lackluster growth, results have been less than satisfactory, with the line eventually suspended since last summer when the eponymous founder left. It is thus a no-brainer that the world’s largest luxury group would let Donna Karan go when a suitable suitor such as G-III expressed interest.