Karl Lagerfeld To Be Fully Owned By G-III in $210 mn Deal

The deal marks G-III's first acquisition since it snapped up Sonia Rykiel in September.
Karl Lagerfeld To Be Fully Owned By G-III in $210 mn Deal

Neal Nackman, Chief Financial Officer and Treasurer, G-III said the company plans to expand Karl Lagerfeld’s reach and bring the label into new product categories. The imprint has a 'very small footwear component' right now and jeans will liven up its category mix 'shortly'.

One analyst already sees an upside opportunity for G-III, whose portfolio includes DKNY, Tommy Hilfiger, and Calvin Klein. “While legacy operations have been mostly licensing-related, the company’s global success with ownership of DKNY in recent years gives us confidence in its ability to execute and grow established labels,” Steven Marotta, Analyst, CL King & Associates, said, adding that the additional stake combined with the existing $175 million in revenue should “add $200 million in incremental top-line sales.”

The deal marks G-III’s first acquisition since it snapped up Sonia Rykiel in September, and Nackman suggested the company’s appetite for M&A is alive and well. 

Jeff Goldfarb, Executive Vice President, G-III stated Karl Lagerfeld’s “expansive portfolio” of men’s, women’s, and children’s products and footprint in ready-to-wear, home furnishings, eyewear, jewelry, fragrance, and footwear, at both accessible and aspirational prices.

Karl Lagerfeld’s outperformance in North America last year laid the groundwork for G-III to fully own the high-potential label. Goldfarb said G-III plans to increase the brand’s digital direct-to-consumer sales and add new locations to the 120 mono-brand company and partner-operated stores it currently has in Paris, London, Berlin, Dubai, and Shanghai. G-III will also figure out how to get Karl Lagerfeld into more doors with new wholesale partners and licensees, building on a distribution network across the U.S., Europe, Middle East, Asia, and digital retail platforms.

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