WSJ: KKR, Sycamore Partners Mull Joint Bid For Jones Group

(RTTNews) - Private equity firms KKR & Co. L.P. (KKR) and Sycamore Partners are mulling to a joint bid for Nine West parent Jones Group, Inc. (JNY), according to the Wall Street Journal report on Wednesday.

There are also other bidders in the fray to buy the whole company, the apparel business only or the footwear business only. This reportedly includes shoe designer Vince Camuto, who could be looking to buy back Nine West, which he sold to Jones for about $900 million in 1999. Nine West is the company's largest label, accounting for 24 percent of its total sales.

The New York-based footwear and apparel maker had in early July reportedly hired Citigroup, Inc. (C) to explore a potential sale of part, some brands or the entire company, and sent feelers to private equity firms and industry rivals.

The New York-based fashion company, founded in 1975, was formerly known as Jones Apparel Group, Inc. and changed its name to The Jones Group, Inc. in October 2010.

Jones Group is the owner of more than 30 retail brands such as Nine West, Kurt Geiger, Jessica Simpson and Jones New York as well as operates hundreds of retail stores. The company's portfolio of brands also include Anne Klein, Easy Spirit, Rachel Roy and Enzo Angiolini. The company currently has a market capitalization of 1.10 billion.

The company also licenses dozens of brands that are sold through department stores such as Macy's, Inc. (M) and Nordstrom, Inc. (JWN).

Several other private equity firms were also considering joint bids for parts or the entire company. The second-round of bids are due to be placed over the next two weeks, with a deal expected to be struck soon after.

Jones Group had in late April announced the shuttering of about 170 underperforming domestic retail stores by mid-2014, and elimination of eight percent of its workforce as part of a strategic plan to improve profitability.

The company also revealed plans to reset its domestic retail business through the reduction of the underperforming stores as well as streamline certain wholesale divisions and the supply chain.

Jones Group in late July reported a net loss of $3.4 million or $0.05 per share for the second quarter, compared to net income of $8.1 million or $0.10 per share last year. Quarterly sales declined 1.1 percent to $845.6 million from the year-ago quarter.

Jones Group had generated sales of $3.80 billion in fiscal 2012, and posted a net loss of $54.3 million or $0.72 per share.

KKR in April 2013 acquired a 65 percent interest in the French luxury apparel retailer SMCP Group. In late 2011, KKR also invested $60 million in China Outfitters Holdings Ltd., and acquired a $30 million stake in Hong Kong-based privately-held apparel retailer Novo Holdco Ltd. It also acquired Dollar General Corp. (DG) in June 2007 in a $6.9 billion deal.

Meanwhile, Sycamore had in mid-June completed the acquisition of teen apparel retailer Hot Topic, Inc. in a $600 million all-cash deal. The Hot Topic deal was the fourth investment by Sycamore Partners, which has more than $1 billion in capital under management.

Earlier, Sycamore acquired a controlling interest in Mast Global Fashions from Limited Brands, Inc. or now L Brands, Inc. (LTD) in late 2011, formed Pathlight Capital, LLC and also acquired Talbots, Inc. in August 2012.

JNY closed Wednesday's regular trading session at $15.11, up $0.58 or 3.99% on a volume of 4.29 million shares.