Cherokee Inc. (NASDAQ: CHKE), a global brand management company, today announced that it has acquired the Liz Lange Maternity® and Completely Me® brands from LLM Management Co., LLC an affiliate of Bluestar Alliance, LLC for an aggregate purchase price of up to $14.0 million, inclusive of performance based earn-outs. The acquisition closed on September 4, 2012.
Credited with revolutionizing modern maternity wear by providing pregnant women stylish, fashion-forward clothing, Liz Lange is one of the most recognized and respected maternity brands sold throughout North America. “We are excited to welcome Liz as the latest addition to our strong and growing family of sought-after style-focused lifestyle brands. In addition to Liz’s current distribution, we see an opportunity to leverage our global platform, which spans over 40 countries worldwide,” said Cherokee Group Chief Executive Officer Henry Stupp.
Liz Lange, Founder and Creative Director of Liz Lange Maternity®, commented, “We are thrilled to become a part of the Cherokee family and work directly with the Cherokee Group management team to expand the reach of our brand to expecting moms around the world.”
The Liz Lange Maternity® collection is exclusively available at all Target stores nationwide and online at Target.com. Through its ten-year history with Target, Liz Lange Maternity® has revolutionized the maternity wear industry.The acquisition also includes a sportswear line that Liz Lange launched in 2010 via exclusive relationships with both the Home Shopping Network in the United States and The Shopping Channel in Canada. Capitalizing on her fashion credibility and design talent, in 2010 Liz Lange launched Completely Me® by Liz Lange, a collection of comfortable sophisticated everyday apparel. In connection with the transaction, Cherokee arranged a new term loan with JP Morgan Chase Bank, providing financing for the purchase price. Mr. Stupp added, “On top of the strong strategic rationale, the economics of the transaction are equally compelling. We expect the transaction to prove immediately accretive and deliver positive free cash flow. Longer term, we see the opportunity to deliver additional top-line growth through enhanced merchandising and marketing initiatives as well as expanded distribution worldwide.”