Perry Ellis signs new fragrance deal
Parlux, but now the licensing agreement for Perry Ellis has been
sold on to luxury goods maker Falic Fashion Group, where further
growth of the brand is the aim.
The deal, which is effective immediately, is estimated to be worth $63m and was brokered as a cash transaction, and also covers the production, marketing and sale of lotions, toiletries and cosmetics.
The deal also includes an agreement to sell on all inventory and outstanding stock of the fragrance business to Falic.
The move follows the December 6th re-sale of the licensing rights to the brand from Parlux back to Perry Ellis International. The transaction was also for $63m and likewise included inventory, molds and other related assets.
Falic says it now expects the transaction to be accretive and that it should increase 2008 earnings by 4 - 5 per cent.
George Feldenkreis, CEO of Perry Ellis International said that Falic was well placed to position the Perry Ellis cosmetic, toiletry and fragrance brand in channels that complement the company's already well established apparel distribution, "further enhancing the cross-category lifestyle concept of our Perry Ellis brand."
Perry Ellis International bought back the cosmetics and fragrance rights to its brand from Parlux in the light of the fragrance licencees continued troubles. Distribution and administration problems at the company have caused sales to fall significantly, affecting all of its brands, which also include Guess, XOXO and Paris Hilton fragrance licenses.
"These agreements will allow Perry Ellis International not only to recoup significantly all of the invested capital utilized for the purchase of assets from Parlux Fragrances Inc., but also to maximize our royalty income from this key product category," Feldenkreis continued.
