LOS ANGELES — The empire of BCBG Max Azria Group is again reaching across the Atlantic.
BCBG said Tuesday it acquired the French sportswear firm Alain Manoukian for $78.5 million in an effort to establish a stronger foothold in the European market. Alain Manoukian operates 300 stores in Europe, including units in France, Belgium and Spain.
Privately held BCBG, based in Vernon, Calif., runs three stores in France in addition to a factory outlet and two stores in Portugal. It has a bigger retail presence in Asia, including Japan, Hong Kong and Singapore. Seven years ago, BCBG acquired the French fashion house Hervé Léger and a year ago bought Paris line Dorothee Bis.
“We hope to take Europe by storm,” David Jehan, president of BCBG’s international division, said in an interview. “[Alain Manoukian] has the best connections in terms of licensing and distributors to help us spread our business model over Europe.”
The sale comes as Alain Manoukian, a public company, seeks to turn three years of losses into a net profit in 2005 after pruning its product base, reducing sale items and increasing sourcing from China, India and Turkey. Based in Valence, the company sells men’s and women’s clothing at a price point between fast fashion and designer. In 2004, sales fell by 8.1 percent to $162.4 million and the company cut its losses to $3.4 million compared with $12.9 million the previous year. Trading of its shares on the Paris stock exchange were suspended Tuesday because of the sale.
Under terms of the deal, BCBG will obtain 63.06 percent of the shares held by the Manoukian family and 26.22 percent of the shares owned by a Danish investing group, paying $37.41 per share. BCBG will make a buyout offer for the 11.72 percent balance and take the company private. The deal is expected to close in 80 days.
Jehan said the strategy of integrating Alain Manoukian into the BCBG portfolio will involve converting about 15 stores to BCBG nameplates; another 15 stores will carry both lines. He said Alain Manoukian will benefit from BCBG’s design assistance and the French firm will help BCBG with distribution logistics.
BCBG is also set to jump into the London market with the debut of four new in-store shops at Harvey Nichols by the end of August. Alain Manoukian will manage that relationship, Jehan said.
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For founder Max Azria, whose company has grown in fits and starts over the years, 2005 has been a busy year. A Rodeo Drive flagship bowed last week after store openings in Moscow and Amman, Jordan. This fall, BCBG is adding outerwear to its line in a licensing deal with the Winlit Group Ltd. in New York.
By 2006, sales are expected to reach $1 billion with the help of the acquisition.
“Since 2002, we’ve been growing at 30 to 50 percent a year,” Jehan said. “The company is making incredible strides.”