Authentic Brands wants to expand Frederick’s of Hollywood products to new channels
June 16, 2015 01:11 PM
Authentic Brands Group LLC today announced it completed the purchase of lingerie brand Frederick’s of Hollywood. Its strategy for Frederick’s includes updating the brand, expanding product categories, and increasing distribution through department stores and specialty retailers in key markets in North America, Europe, Asia, South America and Latin America, the company says. Led by the brand’s traditional intimate apparel, other product categories include beauty, fragrance and personal care, Authentic Brands says.
“Frederick’s of Hollywood supports our strategic focus of diversifying the portfolio and strengthens ABG’s position in the intimate apparel category,” says Jamie Salter, chairman and CEO of Authentic Brands.
Authentic Brands owns several well-known men’s and women’s apparel and accessories brands such as Juicy Couture and Hart Schaffner Marx. The Frederick’s acquisition increases the value of Authentic Brands’ global retail sales to $5 billion, the company says.
Frederick’s was ranked No. 472 in the Internet Retailer 2014 Top 500 Guide, but fell to No. 517 in the Internet Retailer 2015 Second 500 Guide. Its estimated 2014 web sales were $24.75 million, flat compared with 2013. The retailer’s web sales declined steadily since it reported 2009 online revenue of $41.7 million.
Frederick’s of Hollywood closed its stores in April and announced it would do business strictly online. In late April, Frederick’s filed for Chapter 11 bankruptcy protection in U.S. bankruptcy court in Wilmington, Del. Frederick’s agreed to sell its e-commerce operations, inventory and intellectual property to Authentic Brands for $22.5 million in cash and 25% of future revenue, according to court filings.
In May 2014, Frederick’s agreed to be acquired by HGI Funding LLC, a subsidiary of holding company Harbinger Group Inc., and other shareholders. The transaction was valued at approximately $24.8 million, according to Frederick’s.
Authentic Brands bought the intellectual property of apparel retailer Jones New York in April from Sycamore Partners LLC for an undisclosed amount. Sycamore bought The Jones Group Inc. in December 2013.
Jones New York owns and operates multiple apparel and accessories brands and e-commerce sites such as NineWest.com. Jones New York announced in January plans to close its JNY.com e-commerce site, all 127 retail outlet stores and its wholesale operations over the course of 2015. However, JNY.com has remained in operation since the company was acquired by Authentic Brands.