When an A-list celebrity dons new garb, it's been said that designer's currency, or status, in the fashion world triples. But when fashion icon Oscar de la Renta executes a financial transaction even institutional investors start to appear absolutely fabulous.
A private placement closed last week for Oscar de la Renta Ltd. in the form of a working capital facility via a single funding source. The deal was agented by UCC Capital Corporation, itself a well branded name in fashion-related financing thanks to a string of executions for deals backed by intellectual property (IP) like trademarks and brand names.
A portion of the working capital facility was backed by IP, in this case licensing rights that flow off Oscar's trademarks. Besides a world renowned clothing line for men and women, the label includes accessories such as handbags, shoes, eyewear, luggage, swimwear, jewelry, furs and even fragrance.
The size of the deal is not known, but the length of the working capital facility and its structure is consistent with industry standards
"Oscar de la Renta has a great domestic presence here in the U.S. and the rest of the world is wide open for them," said Robert W. D'Loren, president and CEO of UCC. "[It] is a leading global luxury brand name with exciting growth prospects," he said, sighting possibilities such as wholesale to retail channel though the rest of the world, or in opening stores worldwide. "It was more IP centric than most working capital facilities," D'Loren explained of the deal.
Alex Bolen, CEO of Oscar de la Renta Ltd., noted that the cornerstone of its growth strategy was expansion of its signature ready-to-wear women's apparel line, in a release about the private placement.
"There's a very strong foundation under this company and a long history," said D'Loren.
A designer of couture and ready-to-wear apparel for men and women that is produced in the U.S., Renta, himself a native of the Dominican Republic, founded the company in 1966 with a partner, the late Ben Shaw. Revenues for year-end December 31, 2003, were reported at $650 million.
Copyright 2004 Thomson Media Inc. All Rights Reserved.