Seamus Hammond
The Perry Ellis brand has had a notable presence in the fashion industry, particularly in the realm of designer fashion clothing. Founded by American designer Perry Ellis, the brand has left its mark on the red carpet and Hollywood. In 2007, Perry Ellis International, the parent company of the Perry Ellis brand, made a significant move in the fragrance market by signing a new fragrance deal. The licensing agreement for the brand's fragrances was sold to the luxury goods maker Falic Fashion Group, a wholly-owned subsidiary of Duty-Free Americas, Inc. This transaction included the sale of inventory, molds, and other related assets, with the aim of further growing the Perry Ellis fragrance brand.
| Characteristics | Values |
|---|---|
| Year of Fragrance Deal | 2007 |
| Buyer | Falic Fashion Group, a subsidiary of Duty-Free Americas, Inc. |
| Previous Owner | Parlux |
| Transaction Amount | $63 million |
| Included in the Transaction | Inventory, moulds, and other related assets |
| Reason for Sale | Distribution and administration problems at Parlux |
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What You'll Learn
Perry Ellis International bought fragrance rights from Parlux
Perry Ellis International is an American clothing, fashion, cosmetics, and beauty company that includes a portfolio of brands distributed through multiple channels worldwide. The company focuses primarily on sportswear and casual clothing for niche markets. It is headquartered in Doral, Miami, Florida, United States.
Perry Ellis International was founded by George Feldenkreis, who was born in Havana, Cuba, to Russian parents. After moving to Miami in 1961, he founded Supreme International. In 1999, Supreme International acquired Perry Ellis and changed its parent company name to Perry Ellis International with the stock ticker PERY.
In 2007, Perry Ellis International bought back the cosmetics and fragrance rights to its brand from Parlux. The licensing agreement for Perry Ellis was sold to the luxury goods maker Falic Fashion Group, a wholly-owned subsidiary of Duty-Free Americas, Inc. The deal included an agreement to sell all inventory and outstanding stock of the fragrance business to Falic. The transaction was for $63 million and included inventory, moulds, and other related assets.
George Feldenkreis, CEO of Perry Ellis International, said that Falic was well-positioned to position the Perry Ellis cosmetic, toiletry, and fragrance brand in channels that complement the company's already well-established apparel distribution. He added that the agreements would allow Perry Ellis International to maximize royalty income from this key product category.
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Falic Fashion Group purchased the fragrance business
On January 2007, Falic Fashion Group, LLC, a wholly-owned subsidiary of Duty-Free Americas, Inc., purchased the fragrance business of Perry Ellis International. Falic Fashion Group is a family-owned and operated business established in 2001 and is home to several prestigious brands across eight Houses. The group is committed to growth and innovation and has unparalleled expertise in global markets. With the transaction, Falic Fashion Group acquired all rights, titles, interests, certain intangible assets, and inventory of the fragrance business.
Falic Fashion Group is in the business of developing and distributing fragrances for fashion, celebrity, and lifestyle brands globally. The company offers a range of products, including perfumes and colognes, that cater to diverse consumer preferences. They are known for their high-profile collaborations, bringing unique and appealing scents to the market and enhancing brand identities and consumer experiences.
The acquisition of the fragrance business of Perry Ellis International aligns with Falic Fashion Group's focus on prestige and luxury. Perry Ellis International, an American clothing, fashion, cosmetics, and beauty company, has a portfolio of brands distributed through multiple channels worldwide. The addition of their fragrance business to Falic Fashion Group's portfolio further strengthens the group's presence in the global fragrance market.
The transaction between Perry Ellis International and Falic Fashion Group was a cash transaction, demonstrating the group's financial capabilities and commitment to investing in prestigious brands. The specific amount involved in the cash transaction is not publicly disclosed, but it can be assumed that it was a significant investment for Falic Fashion Group. This acquisition showcases Falic Fashion Group's strategic growth and expansion strategy, leveraging their expertise in global markets to enhance their portfolio of prestigious brands.
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The transaction included inventory, moulds and other assets
In 2018, Perry Ellis International (PEI) entered into a $437 million transaction to become a privately held company. Led by George Feldenkreis, the founder of PEI and a member of the company's Board of Directors, the transaction involved the acquisition of all outstanding common shares of Perry Ellis not already owned by the Feldenkreis family. The purchase price represented a premium of approximately 21.6% compared to the company's closing stock price on February 5, 2018, the last trading day before Feldenkreis announced his proposal to take the company private.
The transaction included inventory, intangible assets, and other assets related to the fragrance business, as well as the company's focus on sportswear and casual clothing for niche markets. PEI has a portfolio of brands distributed through multiple channels worldwide and has made several acquisitions and license agreements to expand its business.
For example, in 2005, PEI entered into agreements with South Pacific Apparel Pty Ltd. and Cardinal Clothing Canada, Inc. for the manufacture and distribution of various clothing items. In 2006, they had agreements with Levi Strauss & Co. and JAG Licensing LLC for the manufacture and distribution of men's outerwear and swimwear, respectively. In 2007, PEI entered into a transaction with the Falic Fashion Group, a subsidiary of Duty-Free Americas, Inc., which included the sale of certain assets and inventory related to the fragrance business.
The 2018 transaction to take the company private was financed through a combination of sources, including a Senior Secured Asset-Backed Revolving Loan Facility underwritten by Wells Fargo Bank, a multi-tranche term financing facility provided by Fortress Credit Advisors LLC, and equity provided by the Feldenkreis family. The transaction was expected to close in the second half of 2018, subject to approval by Perry Ellis shareholders and other customary closing conditions.
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Falic aimed to increase earnings and enhance the brand
In 2007, Falic Fashion Group, a wholly-owned subsidiary of Duty-Free Americas, Inc., acquired the fragrance business of Perry Ellis International, Inc. for approximately $63 million. Perry Ellis International is an American clothing, fashion, cosmetics, and beauty company with a portfolio of nationally and internationally recognized brands. The company focuses primarily on sportswear and casual clothing for niche markets.
Falic aimed to increase earnings and enhance the Perry Ellis brand by leveraging its existing portfolio of fragrance and beauty brands. As a leading designer, distributor, and licensor, Perry Ellis International offered a broad line of high-quality men's and women's apparel, accessories, and fragrances. The acquisition of the fragrance business, including licensing rights, inventory, and related assets, was expected to be accretive and increase earnings.
Falic Fashion Group's experience in the fragrance and beauty industry, including their distribution and retail partnerships with luxury brands such as Estee Lauder, Lancome, L'Oreal, Cartier, and others, could have been a significant factor in their strategy to enhance the Perry Ellis brand. By integrating the Perry Ellis fragrance business into their existing operations, Falic could have optimized production, distribution, and marketing strategies, leading to increased efficiency and cost savings.
Additionally, Falic may have aimed to capitalize on the recognition and reputation of the Perry Ellis brand. By associating the fragrance business with the well-established fashion and lifestyle presence of Perry Ellis, Falic could have targeted a wider audience and increased brand awareness for the fragrance line. This synergistic effect across different product categories is a common strategy in the fashion and beauty industries to create a stronger, more unified brand presence in the market.
Furthermore, Falic's acquisition of the Perry Ellis fragrance business aligned with their strategy of acquiring and developing prominent brands. As mentioned earlier, Falic had previously acquired several brands from LVMH Moët Hennessy Louis Vuitton, including fragrance and cosmetics lines. By adding the Perry Ellis fragrance business to their portfolio, Falic expanded their presence in the fragrance industry and could have leveraged economies of scale and cross-brand promotions to enhance the overall brand value and recognition.
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The brand was previously owned by Supreme International
In 1993, Supreme International went public on the NASDAQ stock exchange under the symbol SUPI. The company recorded revenues of $33 million in 1992, a year before its public offering. Supreme International continued to thrive and, in 1999, it acquired Perry Ellis, leading to a significant change. The parent company's name was updated to Perry Ellis International, and its stock ticker became PERY.
Perry Ellis International, headquartered in Doral, Florida, is an American clothing, fashion, cosmetics, and beauty company. It possesses a diverse portfolio of brands distributed through multiple channels worldwide, with a primary focus on sportswear and casual clothing for niche markets. The company has expanded its reach by licensing trademarks from third parties, such as Nike for swimwear and Callaway, PGA TOUR, and Jack Nicklaus for golf apparel.
Throughout the 2000s, Perry Ellis International continued to grow and acquired numerous brands, including several major golf brands. The company extended its product lines and entered into various license agreements for manufacturing and distribution. For instance, in 2005, they partnered with South Pacific Apparel Pty Ltd. for the manufacture and distribution of Savane and Farah men's and boy's dress and casual trousers in Australia, New Zealand, and the South Pacific islands.
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Frequently asked questions
Perry Ellis is an American designer fashion clothing brand owned by Perry Ellis International.
Perry Ellis International was founded by George Feldenkreis, who was born in Havana, Cuba, to Russian parents.
The licensing agreement for Perry Ellis fragrances was sold to the luxury goods maker Falic Fashion Group, a wholly-owned subsidiary of Duty-Free Americas, Inc.
Falic Fashion Group bought the fragrance business in January 2007.
Falic Fashion Group bought the rights to the fragrance business from Parlux, which had previously held the license agreement for Perry Ellis fragrances.
