Perry Ellis goes private via acquisition led by founder

By

Jennifer Braun

Published
Jun 18, 2018

Perry Ellis International Inc. has entered into a definitive merger agreement with its founder, George Feldenkreis, in a $437 million deal, the company announced on Saturday. 

 
The company’s Board of Directors will acquire all of the outstanding common shares at $27.50 a share in cash. 
 
In February, George Feldenkreis made a bid to purchase the American apparel firm, after being ousted from his role of executive chairman some six months earlier, leaving his son Oscar Feldenkreis in the role as CEO. 

The official purchase price is slightly higher than Perry Ellis’ closing stock price on February 5, 2018, the last trading day prior to his proposal to take the Company private.
 
“I believe this transaction will open an exciting new chapter for Perry Ellis, our customers and employees. The markets the company competes in have undergone transformative changes and I believe that Perry Ellis’ ability to invest and innovate is limited by the short-term pressures of being a public company," said George Feldenkreis, in a news statement. 
 
“I am confident that as a private company, Perry Ellis will be best positioned to make investments in digital innovation, artificial intelligence and marketing, that support our long term strategy to grow the Company’s powerful global lifestyle brands, while expanding into higher-margin businesses and channels of distribution, including international, direct-to-consumer and licensing.” 
 
The businessman has been serving as company chairman and chief executive officer since 1993, when the company first went public. It was originally founded under the name Supreme International as part of a larger importing venture, until it acquired the Perry Ellis fashion house in 1999, along with its name. 
 
His son Oscar Feldenkreis will continue to lead the company as Chief Executive Officer, while George Feldenkreis will return to an active role in the management of the company.
 
“Our partners should benefit from our enhanced ability to make long term investments in brands, technology and innovation while continuing to remain focused on executing on our long term growth strategy. Perry Ellis intends to be at the forefront of the crucial digital transformation of the apparel industry from marketing to e-commerce, to applications of artificial intelligence,” added Oscar Feldenkreis. 
 
The transaction is expected to close in the second half of calendar year 2018. It will be financed through Fortress Credit Advisors LLC and Wells Fargo.