Burberry is officially going out on their own!
Last week, the luxury brand was still in talks with Inter Parfums Inc. concerning whether or not they would buy back their fragrance and beauty license.
And now, Burberry has put an end to the chatter, and will purchase their rights at the end of this year for $220.8 million.
Unfortunately for Inter Parfums Inc., the British fashion house's fragrance business makes up about 50 percent of the company's revenue.
But Inter Parfums is trying to stay calm, and said they have a “high effective business model," and still has other fashion brands under their belt such as: Lanvin, Van Cleef & Arpels, Paul Smith, Brooks Brothers, Nine West, Jimmy Choo, Montblanc, Boucheron and Gap.
The firm added:
“We will also benefit from substantial resources to potentially acquire one or more brands, either on a proprietary basis or as a licensee."
Chairman and chief executive officer of Inter Parfums, Jean Madar, also put his two cents in:
“Based on current growth rates for all of our portfolio's brands, our preliminary full-year sales target for 2013 may reach approximately $400 million at current exchange rates."
Following Madar, the executive vice president and chief financial officer, Russell Greenberg said:
"This new situation will allow us to strengthen investments supporting all of our portfolio's brands to accelerate their development while maintaining an operating margin of more than 10 percent. Opportunities for external growth will be examined without urgency, with the priority of maintaining the quality and homogeneous nature of our portfolio.”
Doesn't it sound like the company is trying to sugarcoat their loss?!?
We know one thing's for sure, losing 50 percent of revenue isn't something that anyone can easily bounce back from, so we really hope the corporation does indeed have some new deals on lock.
As for Burberry, they're not trippin' because their fragrance department only makes up 2 percent of their monies.
The label definitely got the better end of the deal!
[Image courtesy of Burberry.]
Tags: boucheron, brooks brothers, burberry, burberry body, gap, inter parfums inc, jean madar, jimmy choo, lanvin, montblanc, nine west, paul smith, russell greenberg, van cleef and arpels