Wet Seal Offers to Buy G+G Assets
Foothill Ranch, Calif., Wet Seal Inc. announced on Thursday it offered to buy the assets of G+G Retail Inc. out of bankruptcy for $15.2 million. The company said the purchase offer will be affected in G+G’s bankruptcy proceeding that same day.
In connection with the deal, an affiliate of Prentice Capital Management LP, a principal investor in Wet Seal, has committed too provide G+G with debtor-in-possession financing to enable the retailer to continue to operate through the closing date of the acquisition.
G+G operates 566 stores in the United States and Puerto Rico under the names of Rave, Rave Girl and G+G. Wet Seal expects to operate 450 under those names, but reserves the right to reject additional leases under the bankruptcy code.
Coach Earnings Soar
New York City, Based on its strong second-quarter results, Coach Inc. is hotter than ever. For the three months ended Dec. 31, net income jumped 37.2% to $174.2 million or 45 cents a diluted share, from $126.9 million, or 32 cents a diluted share, in the year-ago quarter. Sales rose 22.3% to $650.3 million from $531.8 million. Same-store retail sales increased 19.9% (with regular-priced same-store sales up 12.8%, and factory-outlet units up 30.2%).
OfficeMax Adds Details to Plan
Itasca, Ill., OfficeMax’s major turnaround plan will cost about $100 million, the company said. OfficeMax intends to reverse losses and boost sales by focusing on three key areas: cutting costs, improving corporate infrastructure and turning around its retail and contract businesses. As previously announced, the plan includes shuttering 110 stores.
“This is a close to $10 billion company,” CFO Don Civgin said on a conference call. “The turnaround will take time, but we are confident that 2006 will show significant progress towards our intermediate-term goal.”
The company reported a net loss of $3.9 million in the third quarter ended Sept. 24.
The company’s retail initiatives include implementing merchandising strategies intended to expand the company’s small business customer base, growing Print and Document Services, driving incremental sales from the OfficeMax ink refill program, and improving category management. In retail, the company will also pursue cost-savings initiatives from store labor and management programs, as well as advertising and marketing-cost efficiencies.