G-III Apparel Group last week announced the acquisitions of Marvin Richards and Winlit, two privately-held outerwear businesses. Marvin Richards was acquired for $19.2 million and 466,666 shares of G-III common stock, currently valued at roughly $10.20 per share for a total estimated purchase price of $24.0 million. G-III may also be required to issue up to 150,000 additional shares of its common stock based on the future market price of its shares.
G-III acquired the operating assets of Winlit Group, Ltd. for approximately $7.3 million. The seller will also be entitled to receive additional payments based on the performance of the company's new Winlit division through the fiscal year ending in 2009. As a result of this acquisition, G-III will now have the license for all outerwear under the Guess? brand name, for leather outerwear under the Tommy Hilfiger brand name, as well as licenses for Ellen Tracy, London Fog, Pacific Trail, and BCBG by Max Azria.
Sammy Aaron, the president of Marvin Richards, will become president of the new Marvin Richards division of G-III, as well as a director and vice chairman of the company. David Winn, the president of Winlit Group, Ltd., will join G-III as president of the company's new Winlit division.
To finance the acquisitions and fund the increased need for working capital, G-III entered into a $195.0 million secured bank facility led by CIT Group/Commercial Services. Both transactions are expected to be accretive to G-III's net income per share for this fiscal year.
