Iconix To Buy Majority Stake In Ecko Clothing

kailee bradstreet

• October 27 2009
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The Iconix Brand Group, parent company to Op and Mossimo, announced plans to purchase 51 percent of Marc Ecko’s clothing company, parent of the brand Zoo York, for $63.5 million, according to a story posted by Reuters.com. Iconix also just posted double digit growth for its net revenue in Q3. Here’s an excerpt from the most recent update on the sale:

“On a pro-forma basis, Iconix expects the joint venture to generate about $42 million to $44 million in annual net royalty revenue in 2010, of which Iconix’s share will be about $26 million.

“Ecko already has strong licensing partners and a robust European platform, from which we could leverage the rest of our portfolio,” Chief Executive Neil Cole said in a statement.

Iconix said it will form a joint venture company with an affiliate of the sellers of Ecko, whose brands include Ecko Unlimited, Marc Ecko, Rhino logo and Zoo York.

Marc Ecko will continue in his capacity as the chief creative officer, New York-based Iconix said.

The fashion house, several of whose brands are sold at WalMart Stores Inc (WMT.N), Target Corp (TGT.N) and Kohl’s Corp (KSS.N), said some of Ecko’s lifestyle brands would lend themselves easily to Iconix’s direct retail model.

Iconix said it will obtain $90 million of financing at an annual interest rate of about 7.5 percent, making the effective purchase price $109 million.”

Stay tuned to TransWorld Business for more information as it breaks.