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FREMONT, Calif. — Men's Wearhouse has signed a definitive agreement to acquire JA Holding, the parent company of American clothing brand Joseph Abboud, for approximately $97.5 million in cash, subject to certain adjustments.
JA Holding is currently majority-owned by funds affiliated with J.W. Childs Associates, L.P. The transaction is expected to close in the third quarter of 2013.
JA Holding brand names include Joseph Abboud, Joe Joseph Abboud, Joseph Abboud Boys and Joseph Abboud Home. Joseph Abboud-branded products are available in fine department stores and specialty stores throughout the United States, and more than 50 countries worldwide. This transaction includes ownership of JA Holding's exclusive U.S. tailored clothing factory that employs 450 people.
Joseph Abboud, the founder and creator of the brand and a leading menswear designer, has served as chief creative director of Men's Wearhouse since December 2012.
"We are thrilled to reunite Joseph with his iconic brand at Men's Wearhouse,” said president and CEO Doug Ewert. “This transaction accelerates our strategy of offering exclusive brands with broad appeal at attractive prices. Current and future customers will benefit from authentic American designer clothing, manufactured in the USA, at unparalleled value."
"Becoming a part of Men's Wearhouse with its powerful U.S. retail presence and talented management team, I believe the Joseph Abboud brand will not only thrive but will also reach new heights by offering amazing style and quality at an incredible value,” said Abboud. “I am very proud of this modern American brand that I launched in 1987 and I am excited to continue the evolution of the Joseph Abboud design aesthetic for our existing customers while also attracting a new consumer who will experience the level of quality and exceptional service that Men's Wearhouse offers."
"We are proud of the progress that we have made during our nine-year partnership with J.W. Childs in building Joseph Abboud into a modern, sophisticated menswear and lifestyle brand. We look forward to continued growth in the brand at Men's Wearhouse," said Anthony Sapienza, president and CEO at JA Holding.
Men's Wearhouse remains committed to its $200 million share repurchase program, as previously announced in March 2013. The company expects to finance this acquisition and its share repurchase program with cash on hand and/or proceeds from its existing credit facility.
J.P. Morgan Securities LLC is serving as financial adviser to Men's Wearhouse, and Willkie Farr & Gallagher LLP is serving as legal adviser. Kaye Scholer LLP is serving as legal adviser to JA Holding and North Point Advisors is serving as financial adviser.