Portfolio Investments
Lee Cooper: Realised
In 2005, Emerisque Brands was the principal sponsor of the acquisition of Lee Cooper, a denim brand founded in 1908 in East London and then owned by Matalan Group, a UK-based discount retail chain. At the time of its purchase, the brand was not profitable and gross margins were in a sustained decline, particularly due to a rising proportion of overheads and an inefficient supply chain. While the brand’s consumer awareness was strong in certain markets, its future was threatened by a branding and marketing platform that lacked bold vision and strategy. Unfocussed product and an inconsistent, commoditized design direction further challenged the new owners. The Emerisque team, with its principals taking key positions following the acquisition, executed a three-pronged strategy to create value for the new company. It revisioned the brand, reconnecting its authentic DNA with a modern, global consumer base. It implemented top-to-bottom tactics that improved cash flow and margin percentages. It expanded the brand’s reach in the CRIM countries through strategic investment and best-in-breed alliance partners. After collaborating with British popular cultural icons as diverse as the Beatles and “It Girl” Lou Dillon, the brand was re-welcomed to better specialty stores such as Harrod’s and Printemps and is distributed in more than 70 countries. At Emerisque’s exit from its investment in 2008, the brand had nearly 700 stores/shop-in-shops worldwide. Gross margins and licensing income had improved materially, leading to a geometric increase in EBITDA.
HMX Group: Current
In August, 2009, Emerisque Brands and its strategic partner SKNL Group purchased substantially all of the assets of the Hartmarx Corporation, a U.S.-based multi-branded apparel company, out of chapter 11 bankruptcy. Among the brands within the new company, HMX Group, are Hart Schaffner Marx, Hickey Freeman and Coppley, three leading North American legacy tailored clothing brands, Monarchy Collection, Bobby Jones, Jack Nicklaus, Exclusively Misook, Christopher Blue and Sansabelt, and several other labels selling multiple retail distribution channels. Having rapidly accomplished a financial and operational restructuring with a view to restoring the Company’s profitability, ownership is focused on reinvigorating its heritage brands and investing in the home market and emerging market potential of its total portfolio.